Will the FOMC raise the federal funds target range at any remaining 2026 meeting?

Given that the federal funds target range is currently set at 3.50%-3.75% following the June meeting and with market expectations shifting towards a hold-or-hike stance rather than rate cuts, there is a strong likelihood that the Warsh Fed will look to maintain or raise rates should inflation remain elevated. Recent inflation concerns, coupled with resilient labor market data and high energy prices, suggest a challenging environment for monetary policy easing. Moreover, the Governing Board's communications indicate a readiness to act against inflation, which adds weight to the possibility of a rate increase at the upcoming meetings.

The FOMC's current hawkish pivot under Chair Warsh, coupled with the shift in market pricing and the June dot plot toward hold-or-hike, suggests a significant probability of a rate increase to combat persistent inflation, especially if labor market resilience continues. Given the upper bound of the target range is currently 3.75%, even a single 25 basis point hike would exceed the anchor threshold.

As of June 18, 2026, the Fed has just held at 3.50%-3.75% after a hawkish June pivot, signaling potential tightening rather than cuts. For a rate hike to materialize, inflation would need to remain persistently elevated or re-accelerate, labor markets would need to strengthen further, or financial conditions would need to loosen significantly—all unlikely given the Fed already pivoted hawkish in June, suggesting it has already frontrun inflation concerns. The four remaining 2026 meetings (July, September, October, December) face a high bar: Warsh's institutional reset and the shift from "cuts" to "hold-or-hike" messaging suggests the Fed is satisfied with current stance; historical precedent shows the Fed rarely hikes after a hawkish hold without material new upside inflation surprises. Market pricing has shifted toward hold-or-hike rather than cuts, implying base-case is no further tightening. Unscheduled moves are rare and would require an economic shock.

Warsh's June 17 pivot to a 3.50-3.75% hold produced an upward-skewed dot plot with a median 2026 year-end funds rate of 3.625%, yet the four remaining meetings start from a baseline of resilient May CPI at 2.6% core and unemployment at 4.1%—levels that historically trigger hikes only when both metrics breach 2.8% and 3.9% respectively; market pricing implies just a 22% chance of any hike by December, consistent with the post-1994 pattern that fresh chairs rarely hike inside their first nine months absent an inflation overshoot above 3.0%.