Mark McCormick Predicts Four Federal Reserve Rate Hikes

Financial analyst Mark McCormick predicts the Federal Reserve System will implement four interest rate hikes through the first half of 2027 to tighten financial conditions. He attributes current U.S. growth, which exceeds 3%, to an investment boom in AI infrastructure and data centers rather than traditional consumption.

Mccormick warns that a wealth effect, where rising asset values in housing and equities sustain growth instead of income, is currently driving consumption across the United States, Japan, China, and Korea. He expressed specific concern regarding a slowdown in the U.S. housing market and suggested the Bank of Canada may fail to mirror the tightening path of the Federal Reserve.

On the currency front, McCormick forecasts a strengthening U.S. dollar with a target exchange rate of 160 against the yen. He also noted potential risks regarding carry trades in Brazil and Colombia, while describing the European Central Bank as already maintaining restrictive rates due to supply-side shocks.