US FOMC Hawkish Patience

ANZ anticipates a hawkish shift at the June 2026 FOMC meeting as new Chair Kevin Warsh prioritizes inflation targets. The Fed is expected to remain on hold through Q4 despite a bifurcated, AI-driven economic landscape.

Key Takeaways

• 1.The FOMC is expected to adopt a more hawkish tone under new Chair Kevin Warsh, removing implicit easing bias.
• 2.Monetary policy is judged to be 'modestly restrictive' in aggregate, with AI-driven growth conflicting with weaker sectors like housing.
• 3.Inflation is largely driven by exogenous factors, and ANZ expects the Fed to remain on hold through Q4 2026.

Table of Contents

• US FOMC: hawkish patience
• What we're watching from Warsh and the FOMC
• Conclusion

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