Three regional Federal Reserve Bank presidents are pushing back against further interest rate cuts, signaling a more hawkish stance for the remainder of 2026.
The opposition comes as outgoing Chair Jerome Powell offered limited justification for maintaining current policy. The Fed has held the federal funds rate at 3.5-3.75%, with inflation still running above the 2% target, despite having cut rates by 1.75% since September 2024.
Cleveland Fed President Beth Hammack and Dallas Fed President Lorie Logan are among those expressing skepticism about further easing. Powell's term ends May 15, 2026, with Kevin Warsh's nomination moving forward.
As a result, prediction markets now show just a 4.5% chance of a rate cut by June 2026, and a 29.4% probability by September. The odds of a reduction after the June meeting stand at 4%.