Recent FOMC communications and the September 2026 Summary of Economic Projections underpin the 96.8% market-implied probability of zero federal funds rate cuts in 2026. Policymakers raised the target range to 3.75-4.00% last month and placed the median year-end 2026 rate at 4.1%, reflecting upward revisions to growth and core PCE inflation forecasts amid persistent price pressures near 3.4%. Officials including New York Fed President Williams have emphasized a data-dependent approach with no urgency for near-term easing, consistent with labor market resilience and the shift from prior cut expectations. While this consensus appears durable, softer-than-anticipated inflation prints or a sharper labor market slowdown could still prompt a policy pivot before year-end.
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