Standard Chartered Predicts Difficulty in 2026 Fed Interest Rate Cuts, Sees Market Skepticism Rise

Standard Chartered analysts Nicholas Chia and Steve Englander warn that if the US economy continues to perform strongly, interest rate cuts may become challenging by 2026. Their report suggests that while the Federal Reserve will likely continue to lower interest rates in 2025, market expectations for a rate cut in 2026 could decrease as long as economic growth remains robust and productivity increases exceed projections. This is expected to support US bond yields and strengthen the dollar.