Deutsche Bank anticipates a major shift in Federal Reserve policy, projecting 75 basis points of tightening over seven months, starting with a 25 basis point rate hike in September 2026 followed by another in December. Underlying inflation remains stubbornly elevated, with core CPI coming in at 0.29% month-over-month in August, beating market expectations. New Fed Chair Kevin Warsh has affirmed that the 2% inflation target remains firm and fixed. Rate hike probabilities have surged to between 87% and 94% as of mid-September 2026, as energy prices and tariffs continue to fuel persistent inflationary pressures.
Source: Read the original article
