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Traders on Kalshi, the CFTC-regulated prediction market, are betting that Wednesday’s Consumer Price Index report will come in soft. As of Sunday, contracts on the platform show a 68% probability that July’s month-over-month CPI rose above 0.0%, but only an 18% chance it exceeded 0.1%.
What the numbers say
The Bureau of Labor Statistics releases its July CPI data on August 12, and Kalshi’s contracts paint a picture of inflation that’s losing steam rather than gathering it.
On the year-over-year side, traders are pricing in roughly 52-53% odds that annual CPI topped 3.3%. The probability of it clearing 3.4% drops to just 16%.
Why prediction markets matter here
Kalshi isn’t some fly-by-night betting app. Founded in 2018 and designated as a contract market by the CFTC in November 2020, the platform launched fully in 2021. It offers event contracts on a range of real-world outcomes, from economic data releases to weather events.
The value proposition is straightforward: instead of relying solely on surveys of economists, you can observe where people are actually putting money. Skin in the game tends to sharpen forecasts.
What this means for markets
With only a coin-flip probability of exceeding 3.3%, and just a 16% chance of clearing 3.4%, the market is telling us that sticky inflation fears may be overblown, at least for this particular reading.
The Kalshi contracts themselves are purely traditional event contracts with no crypto token component. Worth noting: an 18% probability of exceeding 0.1% month-over-month CPI is not zero. Surprises happen.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
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