Fed Challenged on Rate Cuts, Markets Brace for Policy Swings

0:00Morgan Stanley is challenging the Federal Reserve's outlook for Ray Cuts in 2026, arguing that central banks worldwide are turning more. Hawkesh, due to stubborn inflation, rather than weak growth. The Fed kept its key rate steady at 3.50 to 3.75% in an 11-1 vote last week, with his latest dot. Plots still projecting just one quarter-point cut next year, and another in 2027. Rising oil prices from the Iran War are fueling fresh inflation worries on top of hotter than expected producer prices that showed acceleration even. Before the conflict, this has shifted market bets, with traders not pricing out near-term cuts and baking in chances for rate hikes instead. Investors hope the Fed's projections signaled easier policy ahead, but analysts say markets are underpricing how much the central bank is. Prioritizing price stability over jobs. Bond yields have jumped. Stought valuations tightened, and the old link between higher rates hurting equities is back in play,

1:00squeezing financial. Conditions overall. Fed officials are split on next steps, which Chicago's Austin Ghoulsby warning rates could rise if inflation spikes from the war, while Governor. Stephen Moran holds the four cuts this year unless oil shock spread wider. Traders see a 10.6% shot at a hike by late April, climbing to nearly 40% by October. Until inflation Ghouls or growth stalls hard, expect the Fed to stay cautious, leaving markets exposed to swings from policy shifts in global. Tensions. That's your update from Durham News Today, powered by AI.