Economy
Fed Survey Shows Pause This Week, December Hike Likely, Two More Hikes Expected Next Year
CNBC survey of 30 market experts finds 93% expect a Fed pause in October, 76% see a December hike, and over half forecast about two hikes next year.
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A CNBC poll of 30 fund managers, strategists and economists shows 93% expect the Federal Reserve to hold rates steady at its October meeting, while 76% anticipate a hike at the December session. More than half of the respondents project about two additional rate increases sometime next year.
The survey reveals a split on how aggressively the Fed should curb growth: 40% say growth must fall below its potential, 27% argue no slowdown is needed, and 23% favour only a modest easing. Inflation is seen as a broader issue beyond energy prices, with 70% sharing that view, even as the benchmark U.S. crude price is forecast at $88 a barrel six months out, up from $82 but still below today’s $101.
"Their hesitancy to raise rates is unfathomable after an extended period of monetary and fiscal generosity," said Richard Bernstein, global head of macro investing at Janus Henderson Investors. Other participants, such as Brean Capital’s chief economic advisor John Ryding, argue that "aggregate demand" and inflation data "point to the strong need to hike rates."
Growth projections remain modestly above potential, with GDP this year seen at 2.4%, 2.05% for 2025 and 2.2% for 2027. The Consumer Price Index is expected to ease to 3.6% from 3.7% and drop to 2.6% next year. Unemployment is projected to hold at 4.2% through the rest of the year before inching up to 4.4% in 2027. The S&P 500 outlook sits around 7,600 for this year and 8,033 for next year.
Respondents cite the ongoing Iran conflict and a potential AI‑bubble burst as top risks, while bond yields are attributed to high inflation, rapid growth, and large debt issuance—half pointing to government debt as the primary driver. Political uncertainty also looms, with 63% flagging legal challenges around the upcoming congressional election as a market risk.
Why it matters: The consensus of a near‑term pause followed by a December hike, plus expectations of two more hikes next year, signals how market participants are pricing future monetary policy amid inflation, growth and geopolitical risks.
Source: Fed rate hikes are coming, but not this week: CNBC survey — CNBC