Fed Held Rates Steady in June While Internal Projections Shifted 50 Basis Points Higher
The June FOMC minutes show a unanimous 12–0 vote to hold the federal funds rate at 3.50–3.75 percent that masked a three-way internal split, with the median end-of-2026 rate projection rising 50 basis points to 3.875 percent and 8 of 17 participants forecasting rates above the current range. The disagreement centers on whether inflation driven by a Middle East energy shock and tariff pass-through in goods is transitory or persistent, with the 2026 inflation projection revised up from 2.6 to 3.1 percent. June CPI data due July 15 is the next concrete test of which camp's read is correct, with the September meeting identified as the earliest likely inflection point for a policy change.