UBS forecasts two US Fed rate hikes in 2026 after strong jobs report

Live updates

1. 3d ago

   Traders see 70% chance of Fed rate hike ahead of September 16 meeting

   Traders now price in a 70% probability of a Federal Reserve interest rate increase on September 16. Market volatility is rising as Brent crude oil exceeds 109 dollars per barrel and the 10-year Treasury yield approaches 5%, contributing to a 1.5% slump in the Dow. UBS maintains its forecast of two total rate hikes for 2026. Analysts suggest a 25-basis-point increase could trigger a short-term 1% to 5% drop in Bitcoin prices, provided the Fed offers balanced guidance.

   Why it matters

   High inflation concerns are driven by Middle East tensions and surging energy costs. These factors influence the Federal Reserve's decision on interest rates and affect the global appeal of US Treasurys. Saudi Arabia's A+ credit rating remains stable due to its ability to redirect oil exports during conflicts.

   What is confirmed

   • S&P Global affirmed Saudi Arabia's credit rating at A+ with a stable outlook.
   • Brent crude oil prices topped 109 dollars per barrel.

   Still unconfirmed

   • UBS predicts the Federal Reserve will raise interest rates twice in 2026.

   What to watch next

   • The Federal Reserve interest rate decision on September 16
   • Upcoming US inflation data reports
   Sources used for this update (4)

   1. finance.yahoo.com — What Happens to Bitcoin Price If the Fed Raises Interest Rates on Sept. 16?
   2. www.cnbc.com — The likelihood of a Fed interest rate hike next week just got a lot higher
   3. english.aawsat.com — S&P Global Ratings Affirms Saudi Arabia Credit Rating at A+ with Stable Outlook
   4. hdfcsky.com — Dow Slumps 1.5% as Brent Crude Tops $109, 10-Year Yield Nears 5% Ahead of Fed Meeting
   confidence 80%
2. 7d ago

   UBS Forecasts Two Fed Rate Hikes After Strong Jobs Data

   UBS predicts the US Federal Reserve will raise interest rates twice in 2026 following a strong jobs report. Market participants are currently weighing this against upcoming inflation data and internal Fed disagreements. While Wall Street expects a hike, some analysts argue that such a move depends on high inflation levels. Rising Middle East tensions and oil prices approaching 100 dollars per barrel have increased inflation concerns, contributing to mixed stock futures and a decline in the foreign appeal of US Treasurys.

   Why it matters

   The Federal Reserve determines US borrowing costs to balance economic growth and inflation. Current policy decisions are complicated by internal conflicts and pressure from the White House on Kevin Warsh's Fed. Investors are closely monitoring Consumer Price Index data to gauge the likelihood of imminent rate changes.

   What is confirmed

   • UBS forecasts the Federal Reserve will raise interest rates twice in 2026.
   • US stock futures fell on 8 September due to Middle East tensions and rising oil prices.

   Still unconfirmed

   • Internal conflicts within the Fed have become public ahead of a rate decision.
   • Treasurys are experiencing a capital flow reversal as foreign appeal declines.

   What to watch next

   • Release of this week's Consumer Price Index (CPI) data
   • The Federal Reserve's upcoming policy meeting decision
   Sources used for this update (11)

   1. Barron's — A Fed Rate Hike Depends on Hot Inflation. Don’t Count on Either.Economy Column
   2. Financial Times — Will US inflation data persuade the Fed to raise rates this month?
   3. Bloomberg.com — The Fed’s ‘Family Fight’ Spills Into the Open Before Key Rate Decision
   4. Reuters — UBS forecasts two US Fed rate hikes in 2026 after strong jobs report
   5. Fortune — White House ups pressure on Kevin Warsh's Fed as Wall Street expects hike
   6. Investing.com — UBS expects the Fed to lift rates twice before the end of the year. Here’s why.
   7. CNBC — Treasurys are losing foreign appeal in a historic capital flow reversal — and here's one trade investors favor instead
   8. Business Insider — Will the Fed hike interest rates next week? These 3 economic reports could help decide its next move.
   9. www.livemint.com — US market prediction: S&P 500, Dow futures slip as Middle East tensions push oil towards $100
   10. www.econotimes.com — US Stock Futures Mixed as Fed Rate Hike Bets Rise
   11. www.morningstar.com.au — US markets brief: About that stock market broadening - Plus, the robots are coming
   confidence 80%