Factbox-Major brokerages expect next Fed rate hike in December

Oct 15 (Reuters) – Global brokerages largely expect the US Federal Reserve to raise interest rates at least once more this year after data on Wednesday showed consumer prices accelerated in September, reinforcing expectations that policymakers may need to keep borrowing costs higher for longer.

Citigroup became the latest major brokerage to forecast the Fed’s next rate increase in December, though several strategists said consecutive hotter-than-expected core inflation readings have made an October move a clear possibility.

The central bank is scheduled to hold its next policy meeting on October 27 and 28.

Interest-rate futures are pricing in a roughly 27% chance of a rate increase at the October meeting and an 89.5% probability of a move in December, according to CME’s FedWatch data.

Here are the forecasts from major brokerages for 2026:

Brokerage Total hikes in No. of hikes Fed funds rate

2026 in 2026

BofA Global 50 bps of hikes 2 (October 4.25%-4.50%

Research  and

December)

Goldman Sachs 25 bp rate hike 1 (December) 4.00%-4.25%

J.P.Morgan 25 bp rate hike 1 4.00%-4.25%

(December) 

Nomura 25 bp rate hike 1 4.00%-4.25%

(December) 

HSBC 25 bp rate hike 1 4.00%-4.25%

(December) 

Barclays   25 bp rate hike 1 4.00%-4.25%

(December) 

Deutsche Bank 25 bp rate hike 1 4.00%-4.25%

(December) 

UBS Global Wealth 25 bp rate hike 1 (December) 4.00%-4.25%

Management

UBS Global 25 bp rate hike 1 4.00%-4.25%

Research  (December)  

Morgan Stanley 25 bp rate hike 1 4.00%-4.25%

(December) 

Macquarie 25 bp rate hike 1 4.00%-4.25%

(December) 

Standard Chartered 25 bp rate hike 1 (December) 4.00%-4.25%

Citigroup 25 bp rate hike 1 (December) 4.00%-4.25%

(Compiled by the Broker Research team in Bengaluru; Editing by Shinjini Ganguli, Eileen Soreng, Joyjeet Das, Harikrishnan Nair, Pooja Desai, Devika Syamnath and Tasim Zahid)

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