Federal Reserve Expected to Raise Rates Amid Inflation

The Federal Reserve System is expected to raise interest rates once more before the end of 2026, maintaining a restrictive policy to combat stubborn inflation linked to energy costs. Market projections suggest the first rate cut will not occur until late 2027. These policy decisions come as the United States projects economic growth of 2.4-2.5% in 2026 and 2.2-2.3% in 2027, largely supported by ongoing investment in artificial intelligence.

Global market directions remain heavily influenced by geopolitical tensions in the Middle East. While a gradual recovery in Gulf oil supplies could lower prices during the winter, the Strait of Hormuz continues to be a significant risk factor for energy stability. Similarly, the European Central Bank may keep its policy restrictive as energy costs sustain inflation across the euro area.

Currency markets face potential volatility based on U.S. political developments. Analysts suggest the U.S. dollar may weaken if political actions threaten the independence of the Federal Reserve, a shift that could increase the relative appeal of the euro.