Macro/Oil & Geopolitical Supply Shock/Market Detail

Will the Chicago Fed NFCI exceed 0 (tight territory) by Q3 2026?

condition-resolvedFinancial ConditionsResolves: October 15, 2026

The Condition

Strait of Hormuz sustained disruption (>50% traffic reduction for 14+ days) before June 30, 2026

External probability: 100.0%Source: Polymarket Iran Conflict MarketsResolves: June 30, 2026

Our Ensemble Estimates

If condition is true

88%

Model agreement: 90%

Given Hormuz sustained disruption: Will the Chicago Fed NFCI exceed 0 (tight territory) by Q3 2026?

If condition is false

35%

Model agreement: 80%

Given Hormuz reopens: Will the Chicago Fed NFCI exceed 0 (tight territory) by Q3 2026?

Causal Effect

+53pp(higher)

Sustained Hormuz disruption increases NFCI zero-crossing probability by 53pp (88% vs 35%), unchanged from March 13. Both branches shifted higher by similar amounts (+5pp each). The toolkit exhaustion creates a one-way door under IF TRUE while recession risk from -92K NFP creates independent tightening pressure under IF FALSE.

Unconditional probability:81.1%(blended: P(Y|T) × 100.0% + P(Y|F) × 0.0%)

Why This Matters

Tests whether sustained Hormuz disruption tightens financial conditions enough to push NFCI into positive territory.

Condition Resolved

The condition was TRUE. The IF TRUE branch is now the active prediction.

Resolution Criteria

Chicago Fed NFCI weekly reading exceeds 0.00 for any observation between March 1 and September 30, 2026

Source: Chicago Fed / FRED series NFCIDate: October 15, 2026

Source Analysis

Conditions are transitioning from deceptively loose (NFCI -0.563) to genuinely tight as the oil shock forces risk-off repricing

Financial ConditionsFINANCIAL_CONDITIONSPriority: HIGH

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