Polymarket Recession Bets Drop to 26% as Traders Dismiss Fed Staff Warning Signals

• Polymarket recession odds dropped from 66% peak to 26% probability for U.S. recession.
• Trading volume exceeds $6.6 million as bettors shift toward economic resilience. 
• Fed assessment suggests 50% recession probability as markets price lower risk levels.

Prediction market speculators have grown more optimistic about American economic prospects. Polymarket bettors now assign only a 26% probability of recession by the close of 2025. This represents a sharp turn from the 66% probability at the March peak, when economic uncertainty reigned supreme and recession fears burned hot across financial markets.

The decline in recession betting has been steep and relentless in recent months. Figures put the odds at 66% on May 2, fell to 50% on May 12, and kept falling to 30% on June 2. The latest 26% reading indicates that traders are increasingly convinced the economy is robust, despite continued concerns about inflation.

Fed Staff Assessment Contradicts Market Optimism

The growing discrepancy between the Federal Reserve’s internal forecasts and prediction market sentiment has come into the spotlight. This discrepancy was recently brought to th…

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