PremiumIn Kevin Warsh's inaugural FOMC meeting as the Fed's new Chair, the US central bank is certain to keep the federal funds rate unchanged at 3.50-3.75%. Furthermore, economists largely expect rates to remain on hold this year, with 72 of 102 respondents in a Reuters survey conducted between June 4th and 9th seeing no rate changes through end-2026. Money market pricing had, at one stage, fully priced a rate hike by year-end amid firmer oil prices during the Iran conflict, above-target inflation, and a resilient labor market following the strong May nonfarm payrolls report. However, with the US and Iran subsequently reaching an agreement to end the conflict, which is set to be signed on Friday, and oil prices retracing sharply from their highs, markets have pared some of those expectations and currently price around 18bps of tightening by year-end, implying a 72% probability of a 25bps hike.