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Biggest Ever Bet in Fed Fund Futures Market

ADMIN || 7th January 2026

The largest ever block trade was placed in the fed funds futures market today, with a size of 200,000, the largest ever as confirmed by CME Group. The trade was a sale of contracts, placed at 10:04am New York time, for a risk amount equivalent to approximately $8 million per basis point move in the contract.

While the motive behind the transaction is unclear, and it could be related to unwinding of existing bets, the wager could benefit from a potential shift in market pricing for the Federal Reserve’s policy rate decision in late January.

Fed funds futures are settled monthly, to the average of the Effective Federal Funds Rate (EFFR) for the month, therefore closely tracking the perceived futures path of Fed policy rates. The last trading date on the January fed funds contract is Jan. 30, soon after the Jan. 28 policy announcement. With a few basis points of a rate-cut (4.6 bps to be precise) at that meeting currently priced in the market, the wager stands to gain if these are faded.

The size could constitute potential for both a position un wind ahead of key labor market data Friday or new risk. Should the trade be a new wager, the position also stands to benefit from the Fed funds effective rate, currently at 3.64%, not fixing below that level in coming days.

The previous record-sized trade in fed funds futures was a 84,000 block seen September last year and before that a 72,000 wager back in January 2024.

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