Inflation is running hot and the market expects the Fed to act.
December 2026 Outlook
Shifting Perceptions
A couple months ago, the projections were for rate cuts.
On May 8 ago the forecast was for the Fed to hold steady through March 2027.
Now, hikes are priced in at a slow pace.
Looking ahead to March 2027, the expectation is 4.02 percent up from 3.69 percent on May 8.
The change is slow but significant. We went from cuts, to no change, to one hike in the last 2-3 months.
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