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Posted August 15, 2025 at 1:30 pm
The southern US, the Caribbean, and Bermuda are keeping their eyes on Hurricane Erin. As the E in Erin suggests, it is the 5th named storm of the Atlantic hurricane season and is the first hurricane.
The current ForecastEx market for the number of hurricanes is at 60% for 8 or more and 34% for 10 or more.
From ForecastTrader.
It has been a relatively slow start to the Atlantic hurricane season, but activity typically doesn’t ramp up until around now, so there is plenty of time for many more hurricanes, and we still know very little about where the season will end up.
From NOAA National Hurricane Center.
As of 10:00 am Eastern Time, Hurricane Erin has maximum sustained winds of 75 miles per hour. It is about 560 miles east of the Northern Leeward Islands, moving west at 18 miles per hour.
Below are paths from the NOAA Global Ensemble Forecast System (GEFS), where each path represents a plausible future trajectory within the uncertainty of our observations of the environment (the butterfly effect) and uncertainty in modelling the physical system.
From WeatherNerds.
Below is another set of possible paths generated from Google DeepMind’s AI model (in blue) as well as the premier global numerical weather model (from ECMWF, often referred to as the ‘Euro’ model, in orange).
From Google DeepMind.
Hurricane Erin is expected to intensify quickly from a Category 1 into major hurricane status (Category 3 or above). Below is the forecasted strength in wind speed from a number of different forecast models.
From Tropical Tidbits.
Similarly, below is a set of possible wind speed trajectories associated with each path in the Google DeepMind plot above. Google’s model (blue) is more bullish on rapid intensification and a higher peak intensity than the euro model ensemble (orange).
From Google DeepMind.
Up until now, there had been outlier individual ensemble members that had Erin making landfall (eye crossing land) as a major (Category 3) hurricane in the Bahamas or even possibly on the US east coast. However, in the models’ most recent runs, all tracks stay away from the US East Coast. Bermuda (UK) remains at high risk, and the Bahamas can’t be ruled out, but current forecasts indicate that Erin will not have a substantial impact on other land.
Thus, we would not expect ForecastEx markets for landfalling hurricanes to be shifting substantially in response to Erin. These include markets for the Bahamas, Puerto Rico (US), the Dominican Republic, Cuba, Mexico, the United States, or any state or county within the United States.
From ForecastEx
The analysis in this material is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.
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