Bank of America sees 75 basis points of Fed rate hikes in 2026

The bank shifted from expecting no change this year to forecasting increases in September, October and December, citing resilient economic data and a more hawkish Federal Reserve outlook as investor expectations for three hikes climbed.

7h ago

Fact Check

The Reuters article of June 22, 2026 directly and fully supports the claim: BofA Global Research forecasts 75 bps of rate hikes in 2026 (September, October, December), reversing a prior no-change forecast, citing labour-market resilience and a hawkish new Fed chair. The Odaily newsflash corroborates this and attributes it to Reuters. The claim's '75 basis points'/'three hikes' framing is consistent. Minor nuance: the claim attributes the hawkish outlook generically to the 'Federal Reserve,' while sources specify new Chair Kevin Warsh; this does not change the substance.

Summary

Bank of America now expects the Federal Reserve to raise interest rates by a total of 75 basis points in 2026, reversing its earlier call for no change this year. The bank forecasts hikes in September, October and December, citing strong economic data and more hawkish Fed communication. Investor expectations have also shifted, with 19% now looking for three rate increases, up from 3% a week earlier, although two hikes remains the most widely held market view. A hawkish outlook generally points to tighter monetary policy aimed at containing inflation, with higher rates typically affecting borrowing costs and broader financial conditions.

Terms & Concepts

basis points: Hundredths of a percentage point
hawkish: Favoring tighter monetary policy
Federal Reserve: U.S. central bank