Reasoning
The Federal Reserve's current target range is 3.50 to 3.75 percent as of July 11, 2026. While the June 2026 Summary of Economic Projections (SEP) median for the year end 2026 funds rate has risen to 3.8 percent from 3.4 percent in March, nine of eighteen SEP participants project the rate above the current range, indicating a hawkish tilt. Fed Chair Kevin Warsh's decision to hold rates and erase the prior cutting bias at the June 17 meeting further supports a stance where rates are unlikely to fall significantly below current levels by year end.Key uncertainty
The magnitude and persistence of inflation pressures throughout the remainder of 2026.