Probable forecastOpen
The Fed's Quieter Posture Under Warsh
With the Fed holding rates and signaling they could go higher, a 2026 cut looks more unlikely than not — but the range of outcomes remains wide.
Probable’s read
Low confidence. Synthesized from prediction markets, professional analysts, public opinion, and official data.
Historically, the Fed cuts at least once per year in roughly half of calendar years, but the current cycle is clearly on the hawkish side of that base rate. ABC News reported this week that the Fed left rates unchanged and signaled higher rates are ahead, and that the 2-year Treasury yield continued climbing after what was described as a 'hawkish start' under Warsh. No prediction market in our inputs prices a 2026 cut directly, and no analyst views are available, so Probable is relying on reported rate signals and the base rate, making this a genuinely uncertain call.
What’s likely. The Fed held rates at its most recent meeting and signaled that higher rates may lie ahead, according to ABC News and CNN. The 2-year Treasury yield moved higher after what reporters called a hawkish tone from new Chair Kevin Warsh, suggesting markets are pricing in a reduced probability of near-term cuts. ABC News also noted that Warsh's preference for less public communication could itself add volatility — meaning the next data-dependent pivot, if it comes, may arrive with less forewarning than investors have grown accustomed to under prior chairs.
How Probable got to 35 percent
No prediction market in our inputs covers this specific question, so Probable is anchoring on the historical base rate — roughly 50% of years see at least one cut — and then adjusting downward based on the ABC News and CNN reporting that the Fed signaled higher rates after its most recent meeting and that the 2-year yield continued climbing. The honest range here runs roughly 20% to 50%; anyone who claims more precision is reading more into a single meeting than is warranted. Confidence is low.
Why it matters to you
Rate decisions ripple through mortgage costs, corporate borrowing, and equity valuations — and Warsh's more opaque communication style, as reported by ABC News, means individual meetings may carry more surprise risk than they have in recent years.
What to watch
The next major inflation and jobs data releases will be the clearest near-term signals; a sequence of softer prints would be the most direct catalyst for the Fed to revise its current hawkish posture.
Further reading
The question we’re forecasting
Will the Federal Reserve cut interest rates at least once before December 31, 2026?
Resolves by December 31, 2026 — then we grade it yes/no on the scoreboard.
From the briefing
This forecast was published in Probable’s briefing on Sunday, June 21, 2026: Sunday on Probable — U.S.-Iran nuclear talks hang by a thread as Tehran closes the Strait of Hormuz and Vance flies to Switzerland.
Probable’s forecasts synthesize prediction markets, professional analysts, public opinion, and official data. Drafted with AI from cited sources. Reviewed before publishing. Not financial advice. Methodology · Spot an error?