Recent softening in July inflation and employment data has lowered market-implied odds of a September FOMC rate hike to around 35 percent while keeping expectations for any easing firmly on hold. The federal funds target remains at 3.50–3.75 percent, with inflation still well above the 2 percent goal amid Middle East supply shocks and elevated energy prices. July FOMC minutes revealed three dissents favoring a 25-basis-point hike and broad concern that further tightening may be needed absent clearer disinflation. Economists in recent Reuters polling overwhelmingly expect rates unchanged through year-end, pushing any potential cuts into 2027. The September 15–16 meeting and its updated dot plot will provide the next key catalyst for repricing the policy path.