Recent hotter-than-expected inflation data, including March 2026 CPI at 3.3 percent, combined with elevated energy prices from the Iran conflict, have shifted trader expectations toward fewer or no Federal Reserve rate cuts in 2026. The FOMC held the federal funds target range steady at 3.50–3.75 percent at the April 28–29 meeting amid an unusually divided 8–4 vote, with markets via CME FedWatch now pricing roughly 70 percent odds of no easing through year-end and rising chances of a hike by early 2027. Resilient labor market conditions, with unemployment near 4.3 percent, and solid consumer spending further support a cautious policy stance. The June 17–18 FOMC meeting and upcoming inflation releases will serve as key catalysts for any near-term repricing in rate path probabilities.