Federal Reserve researchers say Kalshi data can provide real-time reference for policymaking.

Three researchers from the Federal Reserve System published a paper on February 12th arguing that data from the prediction market platform Kalshi can reflect macroeconomic expectations more in real time and should be included in the Fed's decision-making framework. The authors include Fed Chief Economist Anthony Diercks, research assistant Jared Dean Katz, and Johns Hopkins University researcher Jonathan Wright. The study compared Kalshi data with traditional surveys and market-implied expectations, concluding that Kalshi provides high-frequency, continuously updated probability distributions for measuring the risk-neutral probability of macroeconomic indicators such as interest rate decisions. The researchers noted that Kalshi reacts more quickly after major policy statements or economic data releases. However, the report emphasizes that the Fed's research paper is for internal discussion and does not represent a formal policy stance. (Cointelegraph)