#In short,# May 2026 PCE data shows sticky inflation. Headline inflation hit 4.1% on energy shocks. Core inflation rose to 3.4% from tech costs and high demand.
#The Fed will hold rates at 3.50%–3.75%. Rate cuts are off the table. Markets price in an 81.5% chance of a rate hike by December.
#The 2% target remains out of reach until 2028. However, forecasters expect a gradual easing cycle by 2027 as energy prices stabilize. #Investors must prepare for a prolonged tight monetary policy environment.
#The Fed will hold rates at 3.50%–3.75%. Rate cuts are off the table. Markets price in an 81.5% chance of a rate hike by December.
#The 2% target remains out of reach until 2028. However, forecasters expect a gradual easing cycle by 2027 as energy prices stabilize. #Investors must prepare for a prolonged tight monetary policy environment.