Kevin Warsh Fed Meeting Expected To Hold Rates

Kevin Warsh’s first Federal Open Market Committee (FOMC) meeting on June 16–17, 2026, is widely expected to leave policy unchanged. Markets and economists are watching to see if the committee will remove the statement’s prior easing bias—language signaling a likely rate cut—and revise forward guidance, a shift that could reshape the outlook for interest rates.

FOMC Decision and Projections

The FOMC will release its policy statement and updated Summary of Economic Projections (SEP), including the dot plot of rate forecasts, at 2:00 PM ET on June 17, followed by Warsh’s first post-meeting press conference at 2:30 PM ET. The committee is broadly expected to keep the federal funds target range at 3.50%–3.75%, with fed-funds futures pricing roughly a 97% probability of no change.

The policy backdrop is tighter than earlier this year. U.S. headline consumer price index (CPI) inflation runs near 4.2% year-over-year, the highest since April 2023, while core CPI, which excludes volatile food and energy prices, stands around 2.9%. Unemployment is about 4.3%, and the 10-year Treasury yield trades near 4.45%–4.55%, close to its 94th percentile historically. Analysts attribute renewed inflation pressures to elevated oil prices, the conflict with Iran, and tariffs implemented under the previous administration.

The current statement still carries an easing bias, signaling the next move would likely be a cut. However, surveys and previews indicate the committee will remove this bias at the June meeting. A Fed survey of 32 respondents found 88% expect removal, while a survey of former Fed officials urged holding rates steady and eliminating the easing bias. Market participants and analysts also expect the SEP and dot plot to look more hawkish than in March, likely erasing the small cut previously penciled in for 2026 and raising inflation forecasts.

Warsh’s Communications Approach and Market Outlook

Kevin Warsh was sworn in as the 17th chair of the Federal Reserve on May 22, 2026, succeeding Jerome Powell. He has criticized the Fed’s large bond holdings and identified balance-sheet reduction as a key priority, viewing the current size as excessive and harmful to the economy. During his confirmation hearings, Warsh emphasized that rate cuts remain possible and expressed a preference for lower interest rates over time but declined to pre-commit to specific paths.

Warsh has expressed skepticism about forward guidance and the dot plot, arguing that markets treat these projections as commitments. Several analysts expect he may stop submitting his own dot and rely more on the baseline statement and the chair’s press conference for communication. About half of surveyed market participants support eliminating the dot plot altogether.

Market pricing has shifted toward a higher probability of future hikes. Research shows at least one 25-basis-point increase priced over the next six months, with roughly a 42% chance the funds rate will trade in a 3.75%–4.00% range by year-end and about a 14% chance it will reach 4.00%–4.25%. Given the inflation figure, the removal of easing bias and a more hawkish projection distribution increase the likelihood that policy will remain higher for longer, pushing any rate cuts into 2027.

"The appropriate move is to hold and remove the easing bias from the guidance," said former Fed officials in a recent survey, emphasizing that inflation, not employment, is the pressing problem.