Looking Ahead to 2026: The Fed’s Turning Point

Everyone is focused on rate cuts, but the real question isn’t if they’ll come — it’s how far and how fast. By 2026, assuming inflation remains near the 2% target and the economy stabilizes, the Fed could be moving from restrictive to supportive policy.

What this means for markets:

• Lower borrowing costs and improving liquidity

• Renewed appetite for risk assets

• Opportunities for equities and crypto to rally

The labor market will be key. Softer hiring, slower wage growth, and weaker consumer spending would give the Fed confidence to cut rates decisively rather than cautiously.

Traders and investors are already circling 2026 — it could mark a major turning point for risk-on markets.

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