Will the Fed decrease interest rates by 25 bps after the June 2026 meeting?

The 25 basis point cut bucket for the June 16–17 FOMC meeting has been priced as a near-impossibility — one of the most lopsided positions in the Fed ladder heading into the meeting. The hold dominates the distribution, with essentially all residual probability concentrated on "no change." Every other outcome, including a hike, is priced at similarly negligible levels. This is not a market with meaningful two-sided uncertainty. The macro backdrop earns that pricing. The Fed has held its target range unchanged across consecutive 2026 meetings, with April minutes reflecting near-unanimous agreement to leave policy in place given still-elevated inflation and resilient economic activity. Earlier expectations for first-half cuts were progressively walked back as inflation proved stickier than the 2025 consensus anticipated. The base case that emerged — hold through the first half of 2026, reassess later — has not been disrupted by subsequent data. The one live variable heading into the June meeting is the CPI print landing days before the blackout period ends. A dramatically below-consensus inflation reading could theoretically shift the internal debate — but "shift the internal debate" and "produce a June cut" are separated by a wide gap. The Fed has shown consistent preference for confirming a trend over multiple data points before moving, not reacting to a single print. For a June cut to materialize, you would need both a shocking inflation number and a Fed willing to abandon its stated patience framework on the basis of one data point. The market's near-zero pricing on that conjunction is correct.