BOJ hikes to 1% as Polymarket sees 70% odds the Fed makes zero 2026 cuts

Jessie A Ellis
Jun 17, 2026 04:03

On Friday, Japan’s central bank raised its policy rate 25 basis points to 1% in a split 7-1 decision, the highest in over three decades.

BOJ hikes to 1% as Polymarket sees 70% odds the Fed makes zero 2026 cuts

Bank of Japan Hikes Rates to 1% as Polymarket Bets Grow on Zero Fed Cuts in 2026

The Bank of Japan lifted its policy rate to 1%, the highest level since 1995, in a decision that underscored global central banks’ focus on inflation. On Polymarket, the “How many Fed rate cuts in 2026?” ladder continues to price a high chance of zero cuts, with the 0-cut outcome leading at 69.75%.

Key Takeaways

Polymarket prices a 69.75% chance the Federal Reserve makes zero rate cuts in 2026 (0 bps).Traders kept the ladder skewed toward fewer cuts as global policy tightening signals persistence in inflation risks.The contract resolves on 2026-12-31, and the 0-cut outcome is up 2.35 percentage points over the past 24 hours.

Japan’s central bank raised its policy rate by 25 basis points to 1%, the highest level in more than three decades, marking an acceleration of the normalization cycle it started in 2024. The decision was split 7-1, with board member Toichiro Asada dissenting in favor of holding rates. Markets reacted with the Nikkei 225 up 0.46%, the yen marginally stronger at 160.22 per dollar, and the 10-year Japanese government bond yield 3 basis points higher at 2.615%. The central bank said it will keep reducing government bond purchases by 200 billion yen per calendar quarter, then maintain monthly JGB purchases of 2 trillion yen from April 2027. It also pointed to faster pass-through from higher crude prices into business-to-business transactions, citing a 6.3% rise in the producer price index in May, the fastest pace in over three years.

Polymarket Data: $35.68M Volume Prices 0 Fed Cuts at 69.75% vs 1 Cut at 20.5% and 2 Cuts at 5.4%

Polymarket has matched about $35.68 million in volume on the “How many Fed rate cuts in 2026?” ladder, with the 0-cut line the clear anchor: 0 (0 bps) sits at Yes 69.75% / No 30.25%. The curve drops sharply at higher cut counts, with 1 (25 bps) at Yes 20.5% / No 79.5% and 2 (50 bps) at Yes 5.4% / No 94.6%, signaling limited appetite for a meaningful easing cycle. Farther out on the ladder, probabilities are priced as tail risks, including 3 (75 bps) at Yes 1.95% / No 98.05% and 4 (100 bps) at Yes 0.65% / No 99.35%. The latest tick shows the leading outcome edging up by 0.15 percentage points to 69.75%, reinforcing a market bias toward no cuts into the 2026-12-31 resolution.

Traders will watch upcoming Federal Reserve communications and inflation data for any shift that would steepen the ladder toward one or more cuts before the 2026-12-31 resolution.

Beyond Fed Cuts: Other High-Volume Macro and Geopolitical Polymarket Contracts Traders Are Watching

Beyond longer-dated rate paths, traders are also concentrating in nearer-term policy timing and broader macro crosscurrents, with 92.5% pricing on “Fed Decision in July?” favoring “No change” as the contract draws heavy attention on the platform. That focus on immediate central-bank signaling has kept activity elevated across other headline-sensitive geopolitical and macro markets as participants look for catalysts that can quickly reprice probabilities.

Odds Trend

WindowChange (pp)24h+2.47d+2.4

By the Numbers

Platform: PolymarketMarket: How many Fed rate cuts in 2026?Contract type: Price strike ladder: each rung has separate Yes/No; Yes means the spot price is above that USD strike at settlement.Resolution window: Dec 31, 2026 (UTC)Status: Active (open for trading)Volume: ~$35,684,732

Top strike rungs

StrikeYesNo0 (0 bps)69.8%30.2%1 (25 bps)20.5%79.5%2 (50 bps)5.4%94.6%3 (75 bps)1.9%98.0%

+9 more strikes not shown

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