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Nomura forecasts no Fed rate cuts in 2026 as inflation rises

BY Reuters | ECONOMIC | 12:06 AM EDT

May 22 (Reuters) - Nomura expects the U.S. Federal Reserve to leave interest rates unchanged in 2026, as higher inflation and waning support among Fed officials for policy easing diminish the chances of a near-term rate reduction.?

"Incoming Fed Chair Kevin Warsh is likely still motivated to ease policy, but recent data and Fedspeak make us skeptical that he will be able to convince a majority of the FOMC to go along with rate cuts," Nomura said in a note dated May 21.

The brokerage had earlier projected two 25-basis-point interest rate cuts in September and December this year.?

(Reporting by Kanishka Ajmera in Bengaluru; Editing by Harikrishnan Nair)

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