* The Polymarket prediction platform shows a 98% probability that the Federal Reserve will cut interest rates by 25 basis points on Wednesday.
* The revisions in the updated economic projections summary for 2025 (SEP) could change expectations about the interest rate path for next year.
* Traders are watching for signs of increasing dissent within the Federal Open Market Committee (FOMC).
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The last meeting of the Federal Reserve Board this year took place on Tuesday morning, and the central bank is scheduled to announce its final decision on monetary policy for 2025 on Wednesday at 2:00 PM Eastern Time. Traders overwhelmingly expect a 0.25% rate cut - which would be the Fed's third cut this year - as the Polymarket prediction market prices a 97% probability for this cut. This level of confidence indicates one of the strongest consensus readings this year across macroeconomic markets.
All eyes are on the updated economic projections summary for 2025 released by the Fed.
In addition to the monetary policy decision, the Fed will release the updated Summary of Economic Projections (SEP), which outlines officials' forecasts for GDP growth, inflation, unemployment, and the path of interest rates through 2026 and beyond. The last economic projections summary, published in September, anticipated only one interest rate cut for 2026 after three cuts in 2025. Any revisions up or down could significantly reshape market expectations for the liquidity environment next year.
Internal divisions within the Fed may resurface again.
Another main focus will be whether the disagreement will re-emerge within the Federal Open Market Committee (FOMC). The October meeting revealed that two members voted against the previous 25 basis point cut, indicating increasing internal disagreement over the pace of easing. Markets will be watching to see if the division widens - or whether the Fed leadership will take a more unified stance heading into 2026.