Barclays becomes latest brokerage to bet on no Fed rate cuts in 2026

Barclays has become the latest major brokerage to drop its call for U.S. Federal Reserve rate cuts in 2026, saying the central bank is now likely to keep policy unchanged through the end of the year.

Reuters reported that Barclays previously expected a 25-basis-point cut in September 2026. The bank now sees no cuts this year, a shift that reflects lingering inflation pressure and elevated energy prices.

Why the call changed

The new forecast lands after the Fed left its target range unchanged at 3-1/2 to 3-3/4 percent on April 29. In its statement, the central bank said inflation remains elevated in part because of recent increases in global energy prices.

That backdrop has pushed more Wall Street firms toward a higher-for-longer view. Reuters has recently reported similar shifts from Deutsche Bank, Wells Fargo and Morgan Stanley, with some of those firms also moving to no-cut expectations for 2026.

Broader market impact

The change matters because Fed rate expectations shape borrowing costs, bond yields and currency markets. A slower path to easing generally supports the dollar and keeps pressure on interest-sensitive assets.

For now, Barclays’ view adds to the growing market consensus that the Fed may stay on hold longer than many investors had expected earlier this year.

What to watch

The next big test for this outlook will be incoming inflation and labor-market data. If energy prices stay high or price pressures remain sticky, more forecasters could follow Barclays in removing 2026 cuts from their base case.