One Report, Very Different Fed Forecasts

September CPI has given the Fed’s next move a fresh twist — and major banks are increasingly divided on what comes after the next hike.

UBS: More hikes into 2027

UBS has shifted to a more hawkish view, now expecting the Fed to deliver another hike in March 2027, after a December increase. That suggests inflation may prove sticky enough to keep rates higher for longer.

Morgan Stanley: Two more hikes

Morgan Stanley also sees a December hike, followed by another increase in March 2027. Its view is based on inflation proving slower to cool than policymakers would like.

J.P. Morgan: One more, then done

J.P. Morgan takes a more moderate view. It expects one more 25bp hike in December, but does not see a prolonged tightening cycle extending into 2027, arguing that much of the inflation pressure remains supply-driven.

Goldman Sachs: December could be the last

Goldman Sachs has also pushed its next hike to December and sees a good chance that the Fed ultimately decides further hikes are unnecessary.

Why It Matters

The difference is important for markets.

A longer hiking cycle would likely mean higher yields and a stronger dollar, creating more headwinds for XAUUSD and EURUSD.

If December proves to be the final hike, the pressure on yields and the dollar could ease — potentially giving gold and other rate-sensitive assets more room to recover.

For now, Wall Street is not debating whether inflation matters.

It is debating how long it will matter for Fed policy.