How many rate cuts in 2026? These mounting pressures will put the Fed at a crossroads this year

What we drew from this source

The claims Via News extracted from this document. We point to the source; we don't replace it.

• For January and March 2026, the bar for another rate cut is much higher than it was in 2025

  80% confidence

• Powell staying on is an existential question for the Fed; he needs to prevent the president from getting a majority on the board

  80% confidence

• RSM projects two rate cuts for 2026, likely arriving later in the year

  80% confidence

• Higher GDP growth and higher inflation should be expected when $100 billion is injected into the economy, and for January and March the bar for another rate cut is much higher than it was in 2025

  80% confidence

• RSM lowered its recession odds for 2026 from 40% to 30%

  80% confidence

• Philadelphia Fed President Paulson sees a path for lower interest rates toward the end of 2026

  80% confidence

• There is talk of Powell being a shadow FOMC head if he stays on as governor while a new chair slavishly follows Trump's policies

  80% confidence

• Trump wants his new Fed chairman to lower interest rates if the market is doing well and that anyone who disagrees will never be Fed chairman

  80% confidence

• The One Big Beautiful Bill Act of 2025 tax cuts could inject $100 billion into the economy

  80% confidence

• Investors see 32% odds of two rate cuts and 30% chance of just one cut in 2026

  80% confidence

• 50% of economists in Bankrate's Economic Indicator Survey expect above-trend economic growth in 2026; 30% expect trend-consistent growth; 20% expect below-trend growth

  80% confidence

• The Trump administration has different goals than the Fed

  80% confidence

• Minneapolis Fed President Kashkari has acknowledged risks to both the labor market and inflation

  80% confidence

• The One Big Beautiful Bill Act of 2025 tax cuts could inject $100 billion into the economy, boosting GDP growth but also bringing higher inflation

  80% confidence

• There is talk of Powell being a shadow FOMC head if he remains on the board after a new chair is appointed

  80% confidence

• Dallas Fed President Logan expressed worries about elevated inflation in late 2025

  80% confidence

• Trump plans to announce his new Fed Chair pick in the not too distant future

  80% confidence

• Wells Fargo economists analyzed the 2026 FOMC as composed of four neutral voters, six dovish voters, and two hawkish policymakers

  80% confidence

• This is an existential moment for the Fed in U.S. democracy and Powell needs to stay to prevent the president from getting a majority on the board

  80% confidence

• Cleveland Fed President Hammack expressed worries about elevated inflation in late 2025

  80% confidence

• If a new chair slavishly follows Trump's policies and urges excessively low interest rates, the committee may end up following Powell's lead instead

  80% confidence

• RSM projects two rate cuts for 2026, likely arriving later in the year

  80% confidence

• There is a very high probability the new Federal Reserve will be more dovish than it currently is, and if so we should expect rate cuts, but the number of cuts is the key question

  80% confidence

• The Trump administration would rather have the Fed run the economy hot before the midterms and align themselves with the political pals of the White House

  80% confidence

• Trump plans to elevate a new Fed chair who wants to cut interest rates even more

  80% confidence

• The probability of more rate cuts is very low unless there is an unexpected shock to the economy, and the Fed's job is much more difficult now because it is not obvious which mandate to focus on

  80% confidence

• Half of economists (50%) expect above-trend economic growth in 2026; another 30% say growth will be consistent with recent trends; 20% say growth will be below trend

  80% confidence

• Neel Kashkari acknowledged risks to both the labor market and inflation

  80% confidence

• Trump wants his new Fed Chairman to lower interest rates if the market is doing well and that anyone who disagrees will never be Fed Chairman

  80% confidence

• Trump announced his Fed chair pick will be named in the not too distant future

  80% confidence

Cited in these Via News reports

• Central Bank Independence Under Pressure as Powell Exit, UK Fiscal Crisis Converge in 2026 →
• Central banks face political capture as Powell term ends amid $2 trillion fiscal hole →
• ECB Signals More Rate Cuts as Fed Independence Fears Rattle Global Markets →
• Fed Holds Rates High as $100B Stimulus Package Revives Inflation Fears Globally →
• Global Rate-Cut Wave Accelerates as Bank of England Odds Hit 84% for March →
• Oil at $80 Squeezes UK Budget as US Social Security Insolvency Advances to 2032 →
• Powell Exit and UK Gilt Crisis Signal Global Central Bank Independence Under Fire →
• Powell's Fed Exit in May Meets $1.1T U.S. Tax Cut as Social Security Insolvency Moves to 2032 →
• U.S. Fed Independence Under Threat as $1.1 Trillion Medicaid Cuts Risk Contagion to Global Markets →
• U.S. Social Security Insolvency Moves to 2032 as $1.1 Trillion in Tax Cuts Hit Federal Budget →
• U.S. spending bill risks $5.5 trillion debt surge, threatens Social Security by 2032 amid global fiscal pressures →
• UK Borrowing Costs Drop as Oil Hits $80, Threatening Global Inflation Fight →
• UK Gilt Markets Face Triple Shock as Fed Leadership Transition Threatens Dollar Stability →
• UK Gilt Yields Jump After Spring Statement as Debt Costs Climb, Fed Transition Looms →
• UK Gilt Yields Rise 15bp as Iran Oil Shock Compounds £50bn Fiscal Gap Before Spring Statement →
• UK Gilt Yields Surge 15 Basis Points as Tax Rises Collide with US Social Security Crisis and Fed Leadership Vacuum →
• US $100B Spending Bill Threatens Global Rate Cut Cycle as Fed Pivots →
• US $5.5 Trillion Tax Cut Plan Threatens Global Banking Stability as Treasury Holdings Hit $4.7 Trillion →
• US Debt to Surge $5.5 Trillion by 2034 as Social Security Faces 2032 Insolvency →
• US Social Security Depletion Moves to 2032 as $3 Trillion Tax Cuts Mirror UK Fiscal Pressures from Oil Shock →
• US Social Security Faces 2032 Insolvency as $1.1 Trillion Tax Cut Package Drains Funds →
• US Social Security Faces 2032 Insolvency as Political Pressure Threatens Fed Independence →
• US Social Security Insolvency Accelerates to 2032, Threatening 30% Cut for 70 Million Recipients →
• US Social Security Insolvency Advances to 2032 as $1.1 Trillion Spending Bill Cuts Revenues →