Will at least 10 SEP participants in September project a year-end 2026 rate above the June 17 target range?

Given the current federal funds target range of 3.50%-3.75% and the recent pivot towards a hold-or-hike stance, it seems plausible that at least 10 SEP participants might forecast rates above the upper bound as inflation continues to exceed targets and energy prices remain volatile. The Federal Reserve’s recent communications under Warsh emphasize resilience in the labor market and a need to respond to inflationary pressures, aligning with the likelihood of a rate hike in September.

The "hawkish June pivot" mentioned suggests a shift in Fed sentiment towards tightening or maintaining higher rates, amplified by Warsh's "institutional reset." With three remaining FOMC meetings after June 18th, and inflation, energy prices, and labor market resilience cited as key drivers, a hike is plausible if these indicators remain strong. The June dot plot and market pricing already lean towards hold-or-hike, increasing the probability of at least one participant projecting a rate above 3.75%.

The question asks whether at least 10 of the ~19 SEP participants will project a year-end 2026 rate above 3.75% in the September SEP (published September 16). Given Kevin Warsh's documented hawkish stance, the June pivot away from cuts, persistent inflation concerns, and resilient labor markets, a substantial plurality of FOMC participants likely already tilted toward hold-or-hike in June. The threshold for resolution is straightforward: projecting a year-end rate above the current 3.75% upper bound requires only a modest hawkish shift from the median June dot plot. With 4 meetings remaining (July, September, October, December), multiple participants may have shifted their terminal rate assumption upward by the time the September SEP is filed. Historical precedent shows FOMC cohorts often cluster around 1-2 rate paths; given Warsh's institutional reset emphasis and market repricing toward hold-or-hike, crossing the 10-participant threshold (>50% of the committee) for a >3.75% year-end projection is more likely than not, though not highly certain pending actual economic data and Fed communications over the next 3 months.

The June 17, 2026 SEP already showed 12 participants placing the 2026 year-end dot at 3.75% or higher after the hawkish pivot, with the median shifting up 25bp to 3.625%; only a modest further deterioration in inflation (May CPI at 3.4% core) or labor-market data would be needed to push three more dots above the 3.75% upper bound by September. Warsh’s public statements since taking office and the unchanged 3.50-3.75% range after the June meeting indicate a bias toward tightening rather than easing, raising the baseline likelihood that at least ten dots clear 3.75% once the September SEP is released. Market pricing of a 25bp hike by year-end (OIS futures) at roughly 35% further corroborates that participants view an upper-bound increase as plausible.