Reasoning
The June 17, 2026 FOMC statement erased the prior cutting bias with Chair Warsh presiding, and the SEP median for year end 2026 rose to 3.8 percent from 3.4 percent in March, with nine of eighteen participants now projecting a higher year end rate than the current 3.50 to 3.75 percent target. Historical base rates show that after such hawkish SEP revisions, the next two meetings typically maintain or tighten policy when incoming data do not reverse the inflation or growth signals that prompted the shift. Recent data through July 2026 show no material cooling in core measures sufficient to restore the prior easing tilt.Key uncertainty
Whether the August employment report reveals a sharper labor market slowdown than the July data implied.