Global Brokerages' 2026 Fed Interest Rate Projections Become Clear
Following the Federal Reserve's latest interest rate move, the interest rate hike expectations and year-end forecasts of global financial institutions for 2026 have been announced.
Following the Federal Reserve's policy rate hike and Chairman Kevin Warsh's first move, global brokerages' 2026 interest rate expectations have become clear. Institutions are projecting different scenarios for the end of the year.
Markets' New Era Interest Rate Expectations
The recent interest rate hike by the Federal Reserve and the first policy move under Chairman Kevin Warsh have reshaped global brokerages' interest rate expectations for 2026.
CME FedWatch Data and Pricing
Following the Fed's hike of the policy rate to the 3.75 to 4.00 percent range, expectations strengthened in the markets that at least one more rate hike will be made by the end of the year, and this probability was priced in at the 90 percent level.
BofA's Double Rate Hike Projection
BofA Global Research expects a total of 50 basis points of rate hikes in 2026, projecting that the Fed will implement two twenty-five basis point rate hikes in October and December.
Goldman Sachs's October Forecast
Goldman Sachs, on the other hand, projects a single 25 basis point rate hike in total for 2026, with this increase expected to take place in October according to the institution's forecast.
Other Banks' December Expectations
Leading banks such as JPMorgan, Nomura, HSBC, Barclays, Deutsche Bank, and Morgan Stanley expect a single 25 basis point rate hike in 2026, projecting that the increase will occur in December.
Citigroup's Scenario Expecting No Policy Change
Unlike other institutions, Citigroup does not foresee any policy change for 2026, estimating that the funding rate will remain in the current range.