June Overview During the Fed’s most recent meeting, they shared that although inflation is tracking in the right direction, with “notable” progress to date, it still sits at a level with which the Fed is not comfortable. In their Summary of Economic Projections, inflation estimates increased for this year and next, while remaining unchanged at 2% for 2026 and beyond, highlighting their belief in the persistence of higher prices while ultimately meeting its target. With higher near-term expected inflation, median estimates now call for one rate cut this year (versus three in March), in line with the messaging that rates will stay higher for longer. Although considerable progress has been made, the Fed’s desire to promote “stable prices for the American people” is leading them to espouse a more restrictive stance for longer, until they can confidently agree that inflation is under control, as indicated by the data. Inflation appears to be the ongoing focus, with the labor market moderating but still healthy.
Read More
The NEAM Vantage Point series of publications delivers actionable insights to insurance executives by covering a wide range of investment and capital markets topics relevant to the insurance industry.