By François Rimeu, Senior Strategist, Crédit Mutuel Asset Management

The Federal Reserve is expected to leave interest rates unchanged at its July meeting. Although inflation remains above the Fed’s Target , with its preferred inflation gauge, the Personal Consumption Expenditures (PCE) price index, rising 4.1% year-on-year in May, the moderation in inflation reflected in June’s Consumer Price Index (CPI) report supports the case for keeping policy on hold.

Our expectations

The Federal Open Market Committee (FOMC) is expected to maintain the Target range for the federal funds rate at 3.50%–3.75%, where it has stood since December 2025. Chair Kevin Warsh is likely to refrain from providing any guidance on the future path of interest rates, in line with his usual communication approach.

In conclusion

The FOMC is expected to reiterate its commitment to maintaining price stability.