Kalshi: Market Prediction Outperforms Wall Street Consensus on Inflation Predictions

**December 22 (CoinDesk) — Prediction markets outperformed Wall Street consensus forecasts for inflation over 25 months, with their average error 40% lower than traditional economist and analyst expectations, according to a study from prediction market platform Kalshi.** Kalshi’s research found the edge stems from aggregating diverse trader information via economic incentives, tapping the "wisdom of the crowd" to react more nimbly to shifting conditions. The findings position market-based predictions as a valuable complementary tool for institutional decision-makers, especially amid high uncertainty. The platform compared its inflation forecasts (focused on year-over-year CPI changes) with Wall Street consensus from February 2023 to mid-2025. Traders’ accuracy outpaced traditional forecasts by 40% on average — and by up to 67% when actual data deviated sharply from expectations.