Persistent inflation pressures from elevated energy prices tied to the ongoing Middle East conflict, alongside a resilient labor market, have driven trader consensus toward delayed or no Federal Reserve rate cuts through the remainder of 2026. The FOMC held the federal funds target range steady at 3.50%-3.75% following its April 28-29 meeting, with March CPI rising to 3.3% year-over-year and April nonfarm payrolls adding a modest 115,000 jobs while unemployment held near 4.3%. Major banks including BofA and Goldman Sachs have revised forecasts to zero cuts this year or first easing only in late 2026 or 2027, contrasting earlier expectations of one to two reductions. CME FedWatch futures currently price near-zero odds of a move at the June 16-17 meeting. Key upcoming catalysts include the May 20 FOMC minutes release and June inflation data, which could shift implied probabilities if labor conditions weaken or energy costs moderate.