JPMorgan Shifts Fed Rate Forecast, Removing 2026 Cuts Amid Resilient Labor Data
JPMorgan Chase has scrapped its prediction for Federal Reserve rate cuts in 2026, now forecasting a 25-basis-point hike in Q3 2027 instead. The revision follows stronger-than-expected labor metrics—unemployment dipping to 4.4% and wage growth holding steady—signaling insufficient economic weakness to prompt easing.
Goldman Sachs, Barclays, and Morgan Stanley similarly delayed their cut projections, with Goldman trimming U.S. recession odds to 20%. Markets now price a 95% chance of unchanged rates at the January Fed meeting, up from 86% pre-data.