Three separate market-implied gauges of the September rate decision all moved hawkish after Jackson Hole. They still don't agree on the odds.
Fed Chair Kevin Warsh used his Jackson Hole keynote last week to make the case for higher rates, and traders responded immediately. What has emerged since is not a single, tidy number but three of them, each measuring the same question and each landing in a different place.
On Kalshi, the "Fed decision in September" market, tied to the Federal Reserve's announcement, was pricing a 52 percent chance the Fed holds rates steady and a 48 percent chance of a quarter-point hike, with a small residual probability assigned to a larger move, on more than $23 million in trading volume. Polymarket's equivalent contract showed a similar but not identical picture: 55 percent for a hold, 44 percent for a hike, on more than $64 million in volume. CME Group's FedWatch tool, which derives probabilities from futures pricing rather than a bettor's market, showed the odds of a rate hike jumping to roughly 60 percent from roughly 36 percent in the span of a single day.
The three gauges do not measure exactly the same thing. Kalshi and Polymarket are wagering markets priced by traders taking the other side of a contract. CME FedWatch backs out a probability from futures pricing. But all three point in the same direction, toward materially higher odds of a hike than markets were assigning before Warsh's remarks.
They do not agree on magnitude. Kalshi's 52-48 split is close to a true coin flip. Polymarket's 55-44 split leans slightly more toward a hold. CME's derivatives-implied reading leans the other way entirely, putting a hike as the more likely outcome. An investor treating "the market says coin flip" as license to build a symmetric hedge is making a materially different bet depending on which gauge they anchor to.
The two-year Treasury yield, the maturity most sensitive to near-term Fed expectations, has climbed roughly 11 basis points since the speech and sits near a two-year high, a corroborating sign that the repricing is not confined to prediction markets. The next hard data point arrives , when the August employment report lands ahead of the Fed's – meeting.
The more accurate description heading into payrolls is not a single consensus number. The September decision has genuinely become close, and exactly how close depends on which market is being used to measure it.