The June 2026 FOMC meeting, led by Chair Warsh, marked a significant hawkish pivot characterized by the removal of forward guidance and an upward revision in the SEP rate path. MUFG responded by delaying their outlook for rate cuts until 2027, citing increased market volatility and persistent inflation risks.
Key Takeaways
- 1.The Fed under Chair Warsh eliminated forward guidance and introduced a new, volatile 'task force' communication style.
- 2.The June FOMC meeting resulted in a hawkish shift in the SEP rate path projections and a selloff in front-end USTs.
- 3.MUFG pushed back expectations for Fed rate cuts to 2027 due to inflation risks and shifting Fed policy.
Table of Contents
- Summary
- FOMC Statement (Hawkish)
- SEP Forecasts (Hawkish)
- Market Thoughts – Vol risks return...
- Forecasts and Conclusion
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Authors
George GoncalvesAgron Nicaj
Securities
US 2-Year Treasury
Themes
Fed Communication ReformIncreased Market Volatility
Regions
North AmericaUnited States