Bloomberg Surveillance · Friday, September 18, 2026
An expert suggests that a 75 basis point increase in interest rates is a typical size for a mid-cycle adjustment, bringing rates back to levels seen earlier in the previous year. This would also help offset an estimated 50 basis point underlying inflation overshoot, aligning with a Taylor rule principle.
“We think 75 bps.”
“But the sooner you do it, the more likely it is that you can stop at 75. That's why we have the 75 back-to-back September, October, December.”
“And the reason we think it's 75 is that's the typical size of a mid-cycle adjustment. It gets you back to where you were earlier last year. And it's also kind of consistent with the idea that the inflation overshoot for us, the underlying inflation overshoot, it's about 50 basis points. And a Taylor rule would tell you, okay, you need to do 75 to offset that.”