Recent hotter-than-expected inflation readings have sharply altered trader expectations for Federal Reserve policy, pushing futures markets to price a meaningful chance of a 25-basis-point rate hike as early as December 2026. With the target range currently steady at 3.50-3.75 percent following the April FOMC meeting, resilient consumer spending and elevated energy prices have tempered earlier assumptions of near-term easing. Market-implied odds now reflect roughly even chances of a December move and over 60 percent probability by January 2027, according to CME FedWatch data. The next policy decision arrives at the June 16-17 meeting, where incoming data on CPI and labor market conditions will test whether the recent inflation trajectory sustains this hawkish repricing or reopens room for cuts later in the year.