📉 Fed Leaning Dovish Despite Mixed Signals — 100 bps Cuts Expected in 2026 📉 🔥analysts say 👀
A new analysis from economist Anna Wong suggests the Federal Reserve’s latest policy statement carries a decisively dovish tone, even though a few hawkish elements remain in the mix.
🔹 Why Dovish?
The Fed raised its growth outlook,
Lowered its inflation forecast, and
Left the dot plot unchanged,
all while announcing new reserve management purchases — a sign of active liquidity support.
🔹 Where the Hawkishness Appears
A key line in the FOMC statement hints at the Fed being prepared for a longer pause in rate cuts. And the dot plot shows only one rate cut in 2026, less than the two cuts markets had hoped for.
🔹 Analyst Expectation: 100 bps of Cuts Next Year
Despite the cautious messaging, Wong expects the Fed to ultimately cut rates by 100 basis points in 2026, driven by:
Weak wage growth, and
No signs of inflation reaccelerating in early 2026.
Overall, markets may need to brace for a dovish Fed that is speaking cautiously — but preparing to ease more aggressively next year.
