Reuters poll: Fed seen on hold through September as Middle East war drives inflation higher. 71 of 103 economists still expect one cut in 2026; nearly a third now forecast no cuts at all.
Reuters poll: Fed seen on hold through September as Middle East war drives inflation higher. 71 of 103 economists still expect one cut in 2026; nearly a third now forecast no cuts at all. Summary 56 of 103 economists expect Fed funds rate to hold at 3.50%-3.75% through September 71 of 103 still forecast at least one cut in 2026; median projection is a single reduction Nearly a third now expect no cuts this year, up from roughly one in six in the previous poll PCE inflation forecasts revised up ~30bps: 3.7% Q2, 3.4% Q3, 3.2% Q4 Middle East war cited as primary driver via fuel and energy price pressures Fed chair nominee Kevin Warsh’s Senate testimony did not shift economist views Unemployment and growth forecasts broadly unchanged: ~4.3% and ~2% respectively Expectations for a U.S.
Federal Reserve interest rate cut have been pushed back significantly, with a majority of economists now forecasting that borrowing costs will remain unchanged through at least September, according to the latest Reuters poll conducted April 17–21. The shift reflects the inflationary impact of an ongoing Middle East conflict now entering its second month, which has driven fuel and energy prices sharply higher, eroded consumer confidence to record lows, and effectively eliminated earlier market pricing for rate reductions. Even the Fed’s more dovish policymakers have acknowledged that inflation remains uncomfortably elevated, removing any sense of urgency to move.
Of 103 economists surveyed, 56 expect the Fed’s benchmark rate to hold in the 3.50%–3.75% range through the end of September. That compares with nearly 70% who had anticipated at least one reduction by that point in a late-March survey, and a majority expecting a cut as early as June in polling from early March. Despite the delay, most forecasters are not abandoning rate cut expectations entirely.