Fed Holds Rates at 3.5%-3.75% as Warsh Dot Plot Shows Nine Officials Projecting Hikes

The June 17, 2026 statement dropped all forward guidance language on additional adjustments and altered the implementation note to condition Treasury bill purchases on maintaining ample reserves only when appropriate. This removed the automatic purchase commitment present in the April memo under Powell. Nine dots now cluster at one or more hikes for 2026, compared with zero in the prior distribution, while the median core PCE path was lifted from 2.7% to 3.3% for the current year.

Warsh’s arrival coincides with resilient labor data and rebounding growth readings that have already pushed market pricing away from cuts. The shortened statement and revised dots indicate the committee is prioritizing the inflation objective over employment risks, consistent with documented central-bank behavior when dual-mandate signals conflict. The balance-sheet language remains operational rather than expansionary.

Primary records show unanimous adoption of the statement with no dissents recorded. Warsh did not submit a dot, leaving eighteen projections. Subsequent press-conference language will be required to confirm whether the dots represent a durable policy pivot or a one-meeting adjustment.

The next scheduled FOMC meeting in July will test whether incoming data sustain the higher inflation path or whether growth moderation reopens room for easing.