Rabobank pushes back its Fed rate cut timeline to late 2026, citing persistent inflation and Middle East energy risks.
Rabobank revised its Federal Reserve rate cut forecast, now expecting the first reduction in October 2026 instead of September 2026. The shift follows signs the FOMC is abandoning its easing bias ahead of the new chair’s first meeting and elevated energy prices due to Middle East tensions.
Previously, the bank projected cuts in September and December 2026. The updated outlook reflects higher and more persistent inflation expectations, along with defensive positioning by the FOMC. A second cut is now forecast for January 2027.
The adjustment underscores concerns over prolonged inflationary pressures and geopolitical risks impacting energy markets.