Mark Zandi, chief economist at Moody's Analytics, said the Federal Reserve should not raise interest rates and will not do so in 2026 [1].
Interest rate decisions by the Federal Reserve dictate the cost of borrowing for millions of Americans. These moves influence everything from mortgage rates to corporate expansion, and overall inflation control.
Zandi shared his outlook during an interview on the CNBC program "Squawk on the Street" [1]. He said that the central bank will not raise interest rates during 2026 [2].
The economist's stance suggests a belief that current monetary policy is sufficient to manage the U.S. economy without further tightening. While the Federal Reserve operates independently, the perspectives of leading economists often signal broader market expectations and potential shifts in fiscal strategy.
Zandi's assessment comes as markets continue to monitor inflation data and employment figures to predict the central bank's next move. The decision to hold rates steady or lower them remains a primary focus for investors and policymakers alike—factors that determine the stability of the global financial system.
Because the Federal Reserve manages the money supply to achieve maximum employment and stable prices, any deviation from expected rate paths can cause significant volatility in the stock market. Zandi's prediction that the Fed will avoid hikes in 2026 [2] aligns with a cautious approach to economic growth.
“The Federal Reserve should not raise interest rates.”
This projection suggests that Moody's Analytics views the current economic environment as stable enough to avoid further restrictive monetary policy. If the Federal Reserve follows this path, borrowing costs for consumers and businesses will likely remain flat, providing a predictable environment for investment and spending through the end of the year.
