Wednesday, 16. December 2026

📈 Economy ✦ AI

Federal Reserve (Fed) keeps its benchmark rate unchanged at 3.50–3.75% at the November and December 2026 FOMC meetings — neither cut nor hike (confirmed by FOMC press releases or Bloomberg by December 31, 2026)

Polymarket sees 88.8% probability of zero rate cuts in 2026 (as of September 2026). The current Fed funds rate is 3.50–3.75% — unchanged for months. The Fed faces a stagflation dilemma: weak labor market (July NFP −23,000, ADP August 38,000) alongside elevated inflation (August CPI forecast >3.2%). Rate cuts would be politically risky with elevated inflation; rate hikes economically dangerous with shrinking payrolls. The existing Cassandra forecast for the September meeting (no change) is already priced in; the same logic applies to November (5th/6th) and December (15th/16th).

82%

Next Year · Predicted for 16. Dec 2026

📈 Economy ✦ AI

FOMC December Meeting (Dec 16, 2026): Federal Reserve Hikes the Federal Funds Target Rate by 25bp to 4.00–4.25%

Monetary policy trajectory: September hike to 3.75–4.00% at 78–81% probability (Polymarket/defirate.com aggregated); October hold per existing Cassandra prediction. For a December hike: US headline CPI August 2026 well above 3.0% YoY (BLS, Sept 11), hawkish Fed Chair Kevin Warsh (Jackson Hole August 2026: 'readiness for further tightening'), 10-year yield near 5% as a market signal of persistent inflation. The existing Cassandra prediction ('Fed funds rate at least 4.00–4.25% by Dec 31, 2026, at least two further 25bp hikes') explicitly implies this December step as hike #2 after September. Counterpoint: the November FOMC (Nov 4) could alternatively be the timing, with December then holding.

57%

Next Year · Predicted for 16. Dec 2026