Bloomberg Surveillance · Wednesday, August 26, 2026
Analysts suggest the Federal Reserve is likely to hold interest rates steady in September due to cooling inflation data and a mixed employment picture. Despite some hawkish sentiment, recent inflation prints, particularly core PCE, have shown signs of moderation, providing the Fed with room to maintain its current stance. Revisions to PCE calculations and a potential tick up in the unemployment rate are also expected to support a 'wait and see' approach.
“I think we're in an environment where the data will look a little bit cooler in the next couple of prints, such that the Fed can avoid hiking and do it credibly. So we're going to see another round of inflation data. That will probably come in on the softer side. The seasonals are in our favor.”
“The other two factors are very much moving into disinflationary territory looking ahead.”
“And so they're not really going to be in the same urgency to hype that they felt in July. And we're in an environment where wage inflation is pretty sluggish and therefore it's not feeding into inflation.”