JPM EM Corporate Strategy Daily

Research evidence excerpt

JPM EM Corporate Strategy Daily

J P M O R G A N Global Credit Research

18 June 2026

The FOMC meeting was decidedly more hawkish than expected, sending UST Emerging Markets Corporate

yields higher and stocks lower. With Warsh at the helm, the FOMC left policy Strategy

rates unchanged in a unanimous 12-0 vote. However, the delivered policy Yang-Myung Hong AC

statement, projections, and prepared remarks were quite hawkish, supporting a (1-212) 834-4274

continued bearish stance according our rates strategists. The statement was ym.hong@jpmorgan.com

completely overhauled, offering no forward guidance, but mentioning, “The J.P. Morgan Securities LLC

Committee will deliver price stability.” The SEP (Summary of Economic Alisa Meyers

Projections) was more hawkish than expected, as the 2026 dots show 12.5bp of rate (1-212) 834-9151

alisa.meyers@jpmorgan.com

hikes, and 6 of 18 dots projecting two or more hikes in 2026. Furthermore, the press J.P. Morgan Securities LLC

conference read hawkishly as well, as Warsh led with the Committee’s Dhawal U Mehta

commitment to price stability. Warsh was evasive when asked about the Fed’s (91-22) 6157 3779

current policy stance, but he offered, “The best way I can describe it is uneven. I dhawal.mehta@jpmchase.com

see some restrictiveness in things like housing. It's hard to use those same words J.P. Morgan India Private Limited

anywhere else.” Implicitly, he argued that policy is not restrictive now. US

Treasury yields ended the day 5-13bp higher with front-end yields rising 11bp, and

the yield curve flattening. While markets’ pricing in a significantly more hawkish

path for Fed policy than the single hike JPM has forecast in 3Q27, our rates

strategists think there is a risk of further bearish follow-through.