The US Federal Reserve is likely to drop its easing bias at the next FOMC meeting and shift toward a tightening stance through 2026, with a 20% chance of a 25 bps hike in December if the Strait of Hormuz remained closed and energy prices spiked further, Elara Securities said in a research report.

US Fed expected to maintain interest rates through 2026 due to persistent inflation risks, overshadowing labour market concerns.

The US Federal Reserve is likely to drop its easing bias at the next FOMC meeting and shift toward a tightening stance through 2026, with a 20% chance of a 25 bps hike in December…

Inflation is rising again as energy shocks push markets to price in potential Fed rate hikes in 2026, shifting expectations away from cuts.