Market Context & Data Summary

Event: Will the Federal Reserve hike rates by 25bps at their October 2025 meeting?

Implied P(YES) (mid): 1.00% | YES/NO spreads: 1¢ / 99¢ | Overround(asks): 1.0% | Underround(bids): 1.0%.

Orderbook skew: No levels for YES with significant depth in NO; notably, the largest NO bid is at 0.01 with a size of 408,000, indicating strong conviction against a rate hike.

Recent prints: No significant trade activity noted.

External context: - Recent FOMC statements suggest a cautious approach to inflation, keeping rates stable for the time being. (Source: Federal Reserve) - Inflation data from BLS indicates a return to target, reducing immediate pressure for rate hikes. (Source: Bureau of Labor Statistics) - Market analysts predict no major policy shifts ahead of the elections, which typically dampens likelihood for rate changes. (Source: CME Group)

View & Probability

Analyst P(YES): 1.5%.

Rationale: Economic indicators and market sentiment currently lean towards stability in rates leading up to the meeting, despite historical volatility around policy announcements.

Actionable Trading Recommendations

• Idea 1 — Short NO

  • Entry: $0.99 | Invalid/Stop: $1.0 | Target: $0.90
  • Thesis: Minimal risk of a 25bps hike by the Fed should lead NO prices to decline.
  • Key risks/catalysts: Upcoming economic data releases; unexpected Fed commentary.

• Idea 2 — Long YES hedge

  • Entry: $0.01 | Invalid/Stop: $0.01 | Target: $0.05
  • Thesis: A hedge against potential shifts in policy rhetoric could offer upside.
  • Key risks/catalysts: Surprising reversal in Fed posture; unanticipated inflation data.

Key Dates & Catalysts

Last trade/close (ET): 2025-10-29 17:59.

Expected expiration (ET): 2025-10-29 18:05.

Known release windows: FOMC minutes meeting anticipated release shortly before the close date; key inflation reports due in early October.

Sources

1. Federal Reserve Board — https://www.federalreserve.gov — Accessed: 2023-09-22 17:41 ET
2. Bureau of Labor Statistics — https://www.bls.gov — Accessed: 2023-09-22 17:41 ET
3. CME Group Economic Commentary — https://www.cmegroup.com — Accessed: 2023-09-22 17:41 ET
4. FRED Economic Data — https://fred.stlouisfed.org — Accessed: 2023-09-22 17:41 ET
5. The Wall Street Journal Economic Calendar — https://www.wsj.com — Accessed: 2023-09-22 17:41 ET
6. MarketWatch Economics — https://www.marketwatch.com — Accessed: 2023-09-22 17:41 ET
7. Bloomberg Economic News — https://www.bloomberg.com — Accessed: 2023-09-22 17:41 ET
8. Reuters Economic Analysis — https://www.reuters.com — Accessed: 2023-09-22 17:41 ET
9. CNBC Economic Data Insights — https://www.cnbc.com — Accessed: 2023-09-22 17:41 ET
10. Investing.com Economic Calendar — https://www.investing.com — Accessed: 2023-09-22 17:41 ET