What Prediction Markets Are Forecasting

Prediction markets currently give a 100% probability that London's temperature will not exceed 5°C on February 20. In practical terms, traders are completely certain the day's high will be 5 degrees or colder. This isn't just a slight lean, it's the strongest possible consensus these markets can show. With over $300,000 wagered across related questions, a significant number of people are backing this view with real money.

Why the Market Sees It This Way

Two main factors explain this extreme confidence. First, the date is in the heart of the UK winter. London's average high temperature in late February is historically about 9°C, but cold snaps are common. The market isn't predicting average weather, it's betting on a specific cold day. Second, and more concretely, this prediction is based on near-term weather forecasts. Unlike political or financial markets that try to peer months ahead, this temperature market is tracking forecasts that become highly reliable just days in advance. By the time this much money is placed, meteorological models for a date just days away are typically accurate, leaving little room for a surprise warm spike.

Key Dates and Events to Watch

For a weather prediction this close, the key event has already passed: the release of authoritative short-term forecasts. The market will resolve immediately on February 21, using the finalized data from the London City Airport weather station. The only thing that could have shifted the prediction was a major, unexpected change in the weather models in the final 48-72 hours before the 20th. At this point, with the market showing 100%, that window has effectively closed.

How Reliable Are These Predictions?

For very short-term weather events, prediction markets like this one are often extremely accurate. They efficiently aggregate the latest forecast data and crowd-sourced interpretation. However, this reliability is specific to near-term forecasts. These markets would be much less reliable for predicting temperatures months in advance. The main limitation here isn't accuracy, but utility. The market tells us what expert forecasts already show, just in a quantified, monetary form. It's a demonstration of collective intelligence on a question with a fast-approaching, clear answer.