FOMC Holds Rates Steady, Drastically Lifts Rate, Inflation Forecasts

02:42 PM EDT, 06/17/2026 (MT Newswires) -- The Federal Open Market Committee was much briefer in its post-meeting statement on Wednesday than in past meetings, removing the easing bias in its statement while raising its rate outlook and inflation forecasts in first meeting chaired by Kevin Warsh.

As expected, the FOMC maintained the target rate for its federal funds rate at 3.50% to 3.75%.

An update to the Summary of Economic Projections now shows a 3.8% median federal funds rate at the end of 2026, suggesting one rate increase as opposed to one rate reduction in the previous SEP in March.

There was a split between nine participants seeing at least one rate increase this year and eight seeing no change. One participant is still expecting a rate increase.

The inflation rate is now seen at 3.6% at the end of 2026, up from 2.7% previously, with core inflation now expected at 3.3%, up from 2.7%.

The unemployment rate is seen at 4.3% the end of the year, compared with the 4.4% rate in the March SEP, but GDP growth expectations were revised lower.

The SEP update also shows a higher end-of-year federal funds rate for 2027 at 3.6%, up from 3.1% previously but below the end-of-2026 rate, and a 3.4% rate at the end of 2027.

Fed Chair Warsh is due to hold a press conference at 2:30 pm ET.

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