Kalshi, the New York outfit best known for prediction markets, is pitching large banks and hedge funds on a new futures market that keys directly off US inflation. The plan is to list contracts that reference the consumer price index and a separate set tied to core CPI, which strips out food and energy.
People familiar say Kalshi is targeting a December go live. Pitch materials show contracts would be listed for the next 12 CPI reference months, then only for May and November in each of the next four years. Trading would run around the clock from Sunday through Friday, with Kalshi Klear LLC serving as the clearinghouse. A company spokesperson said they are working on CPI futures but did not share rollout specifics.
These would be the only futures that settle straight on CPI, a bid to win over macro traders who currently gravitate to the massive interest rate and bond futures listed by CME Group and Intercontinental Exchange. CME tried CPI futures before, but none are listed today.
Kalshi tapped Michael Ashton, who previously traded at Barclays Plc and is known as the Inflation Guy, to architect the contracts and rally institutional interest. Ashton, managing principal at Enduring Investments LLC, said, "There's no exchange that trades this and they want to be the inflation exchange." He also noted, "This is a push they want to make and to some extent the success of their dated-futures ecosystem is going to depend on how this does."
Ashton said prior inflation futures missed what TIPS traders needed, and for this launch he has consulted with banks, long only asset managers, and hedge funds active in US inflation-linked bonds and swaps. Mark Spindel, CIO of Potomac River Capital LLC, has discussed the concept with Ashton and said over the counter inflation swaps require heavy documentation that keeps some players out, while an exchange-traded future could draw more in. A deep market would be "a valuable addition to the toolkit at my disposal, as well as other speculators and hedgers," he said. "We've all been stung by surprising developments in inflation."
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Kalshi's exchange is dominated by sports-related markets, but it already lists monthly event contracts that pay out on whether CPI is above or below a level. Those binary bets have appealed mostly to retail because they lack the smoother payouts institutions tend to want.
The company has also been building so called perpetual contracts on things like crypto and commodities. Perpetuals have no maturity, which makes them awkward in traditional workflows and drew fire from CME CEO Terry Duffy. "People can't manage risk with no expiration date," he said. "Institutions go, 'this is impossible for us to trade.'"
Dated CPI futures answer that specific critique and put Kalshi in closer competition with CME, which dominates listed US interest rate derivatives. They would also broaden Kalshi beyond its sports-focused offerings, an area that many US states contend sidesteps wagering and tax regulations. Requests for comment from CME and ICE about the CPI futures initiative went unanswered.
Inflation traders today mostly use two tools: about 2.2 trillion dollars of TIPS and more than 5.4 trillion dollars of inflation swaps, which trade off exchange. Unlike Treasury or equity markets, there has not been a standardized futures venue for inflation risk, the kind that can deepen liquidity by bringing more participants together on a single platform.
CPI futures would give desks a way to hedge or speculate directly on the index rather than triangulating through swaps. So we're getting into pricing inflation." The bottom line: if the contracts attract the large firms Ashton is courting, your portfolio could soon have a straightforward, exchange traded instrument for pure CPI exposure, sitting alongside TIPS and swaps rather than replacing them.
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