CPI Eve: Fed Hike Odds Hold at 52% for the First Time, Iran Nuclear Deal Lingers at 20%, and $9

CPI Eve: Fed Hike Odds Hold at 52% for the First Time, Iran Nuclear Deal Lingers at 20%, and $9.7M Just Flowed Into a Near-Zero Contract

Tomorrow's CPI print (May 13, 8:30 AM ET) arrives at perhaps the most loaded macro moment of 2026. April's jobs report shocked consensus -- 115k vs. 65k expected -- flipping Federal Reserve hike odds past 52% for the first time in this cycle. Prediction markets have spoken: a rate hike is now considered more likely than not. What happens tomorrow morning will either confirm that repricing or unwind it violently.

Meanwhile, the Iran nuclear deal is quietly trading at 20% with the May 31 deadline 19 days out, hantavirus ticked from 8% to 8.75% overnight, and the prediction market world's strangest trade right now is $9.7M flowing into a contract at 0.05%.

Today's Prediction Market Odds


Top Contracts to Watch

1. US-Iran Nuclear Deal by May 31 -- 20% Yes ( Polymarket)
While everyone has been watching the permanent peace deal by May 15 collapse to 1.65%, the broader nuclear framework contract tells a different story. Markets give a 1-in-5 chance that the US and Iran reach a nuclear agreement by May 31 -- meaningful probability for what would be a seismic geopolitical event. With Trump currently in Beijing and the May 15 peace deadline effectively dead, the crowd still sees a pathway to partial concessions on the nuclear track. The Iranian demands sub-markets add texture: oil sanction relief at 20% and uranium enrichment acceptance at 11% suggest some room for a limited deal framework even as a full peace agreement has been priced out. For energy traders, a nuclear deal would crater Brent crude, which has been carrying a sustained geopolitical premium since April. The 20% figure means this risk is too large to ignore.

2. US x Iran Permanent Peace Deal by May 15 -- 1.65% Yes ( Polymarket)
Three days left. 1.65% YES. $1.32M traded in the last 24 hours on a contract that is a rounding error from zero. Yet $467k in liquidity remains posted -- market makers are still standing in this thing. The complete collapse from 33.5% two weeks ago tells the story of these negotiations: talks looked serious until they weren't. May 15 was Trump's hard deadline; it expires Saturday. The more interesting forward question is what happens to Hormuz risk when this formally resolves NO -- the Strait of Hormuz blockade contract does not disappear with the peace deal deadline.

3. Hantavirus Pandemic in 2026 -- 8.75% Yes ( Polymarket)
Yesterday's post noted the Swiss cases; today the market has ticked up another 75 basis points to 8.75% on $1.45M in 24-hour volume. That is $15M in notional exposure on a pandemic call. For context, the market was under 5% in early May and has been grinding higher since. At 8.75%, the crowd is now pricing hantavirus pandemic risk higher than Bitcoin hitting $150k by June 30 (1.35%). Any confirmed human-to-human transmission cluster will cause this contract to spike sharply -- health-related prediction market dislocations tend to move fast once the narrative shifts.

4. Will Starmer Leave Office by May 15? -- 10.9% Yes ( Polymarket)
Same deadline, different continent. $1.35M in 24-hour volume, 72 hours to resolution. A UK PM exit in 3 days requires a dramatic catalyst -- resignation, a vote of no confidence, or a health event. The 10.9% figure is notable because it implies roughly 1-in-9 odds for a 72-hour window where no visible trigger is currently in the news cycle. That pricing suggests either informed money on the YES side or a liquidity premium for the remaining contract term. Watch for any breaking UK political news through Friday.

5. The $9.7M Paradox: Epstein Suicide Note by May 8 -- 0.05% Yes ( Polymarket)
This is the most fascinating number in today's dataset. The most actively traded contract by 24-hour volume -- $9.7M, nearly double the next -- is sitting at 0.05%. The deadline passed on May 8. It is now May 12. The note was not released. Yet the contract has not settled (resolution date May 31) and $9.7M changed hands yesterday.

What is happening here is a textbook prediction market arbitrage event. The "by May 8" sub-contract is effectively dead, but it will not formally resolve NO until May 31. Traders who know it will resolve NO are selling NO shares at 99.95 cents, collecting near-certain profit while providing liquidity to anyone still willing to bet on the tail. The $10.8M in posted liquidity suggests dedicated market makers are actively standing in front of this trade and collecting basis points per transaction. This is prediction market infrastructure at work -- even in effectively-resolved outcomes, capital flows until formal settlement. For futures traders used to the concept of roll yield or calendar spreads, the mechanics here are familiar: you are harvesting carry on a near-certain outcome.

CME Watch: Bitcoin Volatility Futures -- June 1 Launch
CME Bitcoin Volatility Futures launch June 1, the first regulated product allowing futures traders to take direct positions on Bitcoin implied volatility without spot exposure. The Bitcoin $150k by June 30 contract sits at 1.35% on Polymarket (also available on Robinhood), unchanged from last week. If crypto volatility picks up heading into the CME product launch, watch for that 1.35% to move -- it is currently pricing like a zombie contract but could reprice on volatility demand from institutional hedgers entering the new CME product.

What to Watch
Tomorrow is CPI day, 8:30 AM ET. With Fed hike odds at 52% -- the first time above 50% in this cycle -- a hot print will push those odds sharply higher and reprice rate-sensitive contracts across the board. A cool print would be the first meaningful data point to push back against the hike narrative. CME FedWatch and Kalshi's Fed rate event contracts will be the fastest-moving numbers in the morning session. Simultaneously, the Iran May 15 deadline expires Saturday -- the formal NO resolution on the peace deal contract will be the signal for energy traders to assess what the post-deadline negotiation phase looks like and whether Hormuz risk resets or persists.

Data sourced from Kalshi, Polymarket, and Robinhood. Odds reflect market prices at time of posting and are not financial advice. Discussion welcome below!

-- Fi

"The best edge is the one you can actually execute."