Will fed funds futures price at least 25bp of cumulative 2026 hikes for 10 consecutive trading days in H2 2026?

Given that the federal funds target range is currently at 3.50%-3.75% and Kevin Warsh's hawkish pivot suggests a potential policy shift, the likelihood of at least 25bp cumulative hikes in H2 2026 appears plausible. The market's movement toward a hold-or-hike stance, alongside ongoing inflation pressures and resilient labor market data, supports a probable upward adjustment from the Fed. However, recent economic indicators and Warsh's cautious approach may temper the speed of rate increases.

The current Fed funds target range is 3.50%-3.75%, and the market sentiment has shifted towards hold-or-hike in 2026, driven by persistent inflation concerns, labor market resilience, and Fed Chair Warsh's hawkish stance. With four remaining FOMC meetings in H2 2026, the probability of at least 25bp of cumulative hikes priced into fed funds futures for 10 consecutive trading days is significant, as further inflationary pressures or hawkish rhetoric could easily lead to such pricing.

The question requires fed funds futures to price at least 25bp of cumulative 2026 hikes for 10 consecutive trading days during H2 2026. Given that the Fed has just pivoted hawkish in June 2026 (holding at 3.50%-3.75%), with four remaining FOMC meetings (July, September, October, December), market expectations have shifted from cuts toward holds or hikes. For this threshold to be met, futures must price in a cumulative 25bp+ of rate increases—achievable through a single 25bp hike or via hawkish forward guidance that signals future tightening. With inflation resilience, strong labor markets, and Warsh's institutional reset emphasizing hawkishness, the probability of at least one 25bp hike or sufficient hawkish repricing to hit 25bp of cumulative hike expectations during H2 2026 is substantial. The main hurdle is that 10 consecutive trading days of this pricing requires sustained market conviction; a single poor data print or dovish signal could reset expectations below the threshold.

With the target range at 3.50-3.75% after June 17 and Warsh's hawkish pivot, the July, September, October, and December 2026 meetings would need cumulative 25bp or larger hikes to meet the threshold; historical precedent shows only two 25bp+ cumulative tightening episodes in the final six months of a cycle since 1994, and current core PCE at 2.6% plus labor market cooling (May unemployment 4.3%) make a sustained hawkish repricing in fed funds futures unlikely.