Prediction market Polymarket now prices an 82% chance that the Federal Reserve will not cut interest rates in 2026, up from 80% earlier. The shift came as a research note arguing for near-term yuan strength against the dollar failed to move the needle on rate-cut expectations.
Polymarket's rate-cut odds edge higher
Traders on the decentralized platform have been betting heavily on a no-cut scenario for next year. The latest reading of 82% marks a slight increase from the previous 80% level, suggesting that market participants are increasingly convinced the Fed will hold rates steady through 2026. The move comes just ahead of a key consumer price index (CPI) print that could either confirm or challenge that view.
The yuan note that didn't move the needle
A research note titled 'Chinese Yuan: Upside bias against US Dollar' pitched near-term strength for the yuan versus the greenback. The note was framed as an FX tilt rather than a Fed forecast, and it did not shift Polymarket odds on Fed rate cuts. Traders appear to have treated the analysis as a currency-specific call, not a signal for broader monetary policy.
CPI print looms as next test
With the CPI release approaching, the Polymarket odds will face a real-world check. A hotter-than-expected inflation number could push the no-cut probability even higher, while a cooler print might revive bets on a rate reduction. For now, the market is leaning heavily toward no action from the Fed in 2026, and a yuan-focused research note wasn't enough to change that.
