The Federal Reserve held interest rates steady at the conclusion of the June FOMC meeting. Chair Jerome Powell highlighted persistent inflation fueled by the US-Iran conflict and rising global energy prices as key factors delaying any near-term policy shift.
With CPI and PCE indices both above 3%, the central bank remains focused on its dual mandate. Markets now see only a 4.5% probability of a rate cut by June 2026, down from 6% a day ago. The likelihood of a 25 basis point cut at the July meeting has also dropped sharply.
Powell's press conference underscored the uncertainty surrounding the Middle East situation, even as domestic economic activity continues to expand steadily. Analysts are watching for potential dissent among FOMC members and the upcoming April CPI report for further clues on inflation trends.