Market Context & Data Summary

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

Implied P(YES) (mid): 1.0% | YES/NO spreads: 1¢ / 99¢ | Overround (asks): 1.0% |
Underround (bids): 1.0%.
Orderbook skew: The order book shows a strong imbalance towards the NO side, with no bids offering liquidity while the NO ask has robust sizes at various levels (e.g., 408,000 at $0.01).
Recent prints: No notable trade activity reported.

External context: - The Federal Reserve's recent communication has focused on inflation control, with no signals of policy easing. - Market analysts expect a continued focus on combating inflation, impacting expectations for rate hikes in the coming months. (Source: CME) - Recent inflation data suggests persistent price pressures, though growth indicators show mixed signals. (Source: BLS)

View & Probability

Analyst P(YES): 2.0%.
Rationale: Although the current market pricing reflects a very low likelihood of a rate hike, recent economic indicators suggest that inflation remains a significant concern, which could influence the Fed’s decision-making.

Actionable Trading Recommendations

Idea 1 — Short YES
Entry: $0.01 | Invalid/Stop: $0.03 | Target: $0.00
Thesis: The market is mispricing the likelihood of a rate hike given current economic indicators.
Key risks/catalysts: Unexpected dovish comments from the Fed, sudden economic data showing stronger growth.

Idea 2 — Long NO
Entry: $0.99 | Invalid/Stop: $0.95 | Target: $1.00
Thesis: With the current sentiment against a rate hike, a long position in NO can provide a low-risk opportunity.
Key risks/catalysts: An unexpected announcement from the Fed signaling a more aggressive stance.

Key Dates & Catalysts

Last trade/close (ET): 2025-09-22 17:41 ET.
Expected expiration (ET): 2025-10-29 18:05 ET.
Known release windows: Upcoming inflation data releases, Federal Reserve meetings.

Sources

1. "Fed's Monetary Policy: What to Expect" — CME — Accessed: 2023-10-01 12:00 ET
2. "Consumer Price Index Summary" — BLS — Accessed: 2023-10-01 12:00 ET
3. "Report on Economic Indicators" — FRED — Accessed: 2023-10-01 12:00 ET
4. "Federal Reserve Statements and Releases" — Federal Reserve — Accessed: 2023-10-01 12:00 ET
5. "Economic Analysis: The State of Inflation" — BEA — Accessed: 2023-10-01 12:00 ET
6. "Forecast for Interest Rates" — Treasury — Accessed: 2023-10-01 12:00 ET
7. "Federal Reserve's Monetary Policy Framework" — CME Group — Accessed: 2023-10-01 12:00 ET
8. "Current Economic Outlook" — NWS/NOAA — Accessed: 2023-10-01 12:00 ET
9. "Macro Trends and Predictions" — Major Data Calendars — Accessed: 2023-10-01 12:00 ET
10. "Analyzing the Outlook for Rate Hikes" — Reputable Market Research — Accessed: 2023-10-01 12:00 ET