Over half of economists predict a Fed rate hike by the end of 2026.

Huoxing Finance reports that, on June 16, a survey conducted by the Financial Times in collaboration with the Clark Center at the University of Chicago Booth School of Business, involving 47 economists, found that more than half of respondents expect the Federal Reserve to raise interest rates by at least 25 basis points before the end of 2026 to address inflation approaching 3.8%. This marks a clear reversal from early March, when most economists anticipated rate cuts. Although a peace agreement between the U.S. and Iran and the potential resumption of shipping through the Strait of Hormuz may ease energy price pressures, several economists believe that inflationary pressures will continue to transmit to the real economy, and high inflation may persist for an extended period. The market generally expects that the first FOMC meeting chaired by new Fed Chair Walsh will hold rates steady; however, as the U.S. labor market remains robust and economic growth shows resilience, voices within the Fed supporting future rate hikes are growing. Joe Lavorgna, Chief Economist for Asia-Pacific at Sumitomo Mitsui Banking Corporation and former advisor to Treasury Secretary Bessen, stated that Trump’s persistent calls for rate cuts will not influence Walsh’s policy decisions—interest rate paths will ultimately depend on economic data. Additionally, the Financial Times survey found that nearly 70% of responding economists believe the probability of a more-than-20% correction in the S&P 500 over the next year exceeds normal levels, citing elevated valuations in tech stocks—particularly in the semiconductor sector—and warning of structural bubble risks in the market.