Market participants expect little change in the federal funds rate target range this year

According to Jinshi reports, the Federal Reserve meeting minutes indicate that market participants expect little change in the target range for the federal funds rate this year. The implied probability of a rate hike in the first quarter of 2027 based on option prices is about 30%. Surveys show that there will be two rate cuts of 25 basis points in the next year, with the timing of the cuts expected to be later than in the last survey, occurring in the third or fourth quarter of 2026 and the first quarter of 2027, respectively.