MUFG analyst Derek Halpenny said the Fed will release minutes from the June FOMC tonight but warned against over-interpreting details because the pre-June meeting backdrop differs materially from today. The FOMC dot plot was likely compiled in the week to June 12 and would not reflect a hypothetical meeting held now — in particular it would not show nine participants favoring hikes. On that basis he says Overnight Index Swap pricing for further hikes looks rich. The market still prices roughly a

MUFG analyst Derek Halpenny said the Fed will release minutes from the June FOMC tonight but warned against over-interpreting details because the pre-June meeting backdrop differs materially from today. The FOMC dot plot was likely compiled in the week to June 12 and would not reflect a hypothetical meeting held now — in particular it would not show nine participants favoring hikes. On that basis he says Overnight Index Swap pricing for further hikes looks rich. The market still prices roughly a 30% chance of a July 29 rate hike; given recent softening in labor-market data, Halpenny views that as too high. By March 2027 the market has priced nearly 40bp of tightening, but MUFG expects cuts are more likely than additional hikes by then.