Fed May Reverse 75 Basis Points of 2025 Rate Cuts, Says RBC Strategist

CME0.24%
According to RBC Wealth Management Senior Portfolio Strategist Thomas Garretson, the Federal Reserve could either skip rate hikes entirely or raise rates three times in 2026, potentially reversing the 75 basis points in "insurance cuts" implemented under former Chair Jerome Powell in 2025. As of July 10, CME FedWatch data showed a 40% probability of at least one rate hike and 33% probability of two hikes this year. Garretson noted that with labor market stability and core inflation trending in the wrong direction, the Fed may need to unwind last year's easing measures if economic momentum persists through summer.
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