The Federal Reserve

 The Federal Reserve held its benchmark interest rate steady in a range of 3.5% to 3.75% during newly appointed Chairman Kevin Warsh's first meeting. However, policymakers signaled a potential rate hike later this year, with nine of 18 officials projecting at least one quarter-point increase before 2026 ends. [1, 2, 3]

Decision Breakdown

• The Decision: Unanimous vote to leave rates anchored at 3.5% – 3.75%, unchanged since late 2025. [1, 2]
• Future Outlook: Nearly half of policymakers now support a rate hike later in the year, primarily driven by resurgent inflation and energy shocks. [1, 2]
• Market Reaction: Traders are pricing in a roughly 60% probability that the first rate hike could occur by October or December. [1]
• Policy Shift: The Fed released a dramatically shorter policy statement and officially removed language that previously signaled an inclination for future rate cuts. [1, 2]