Kevin Warsh’s first Federal Open Market Committee meeting on June 16–17 is likely to mark a formal shift away from the Fed’s easing bias, opening the door to potential rate hikes later in 2026 as inflation accelerates and labor markets remain firm.

The CME FedWatch Tool now assesses one or two hikes as relatively likely in 2026, even though holding rates steady is possible, too. The main change to most forecasts since earlier in 2026 is that interest rate cuts are now seen as highly unlikely this year.

What Fed Officials Are Signaling

The move away from cuts towards possible hikes reflects economic data. Fed Gov. Christopher Waller said at a May 22 speech in Frankfurt that, "Recent jobs data show that the labor market appears to be stabilizing and the unemployment rate is fairly low and........

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