CNBC Fed Survey: 86% Now Expect Rate Hikes, Up From 46% — SkimNews
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- CNBC Fed Survey respondents shifted sharply, with 86% now expecting at least one rate hike over the next year, up from 46% the prior month; 55% expect more than one hike and a third predict three or more.
- Fed Chairman Kevin Warsh's hawkish Jackson Hole speech, surging oil prices and inflation that failed to cool drove the shift in views among the 29 economists, fund managers and strategists surveyed.
- CPI forecasts rose to an average near 3.5% for 2026 and 2.85% for 2027, with roughly three-quarters of respondents saying inflation is now broader than energy alone.
- Most respondents believe the Strait of Hormuz will remain closed at least another month and that oil prices will stay elevated for more than six months.
- Despite the shift to multiple-hike forecasts, the growth outlook barely budged: recession probability held at 29%, GDP around 2.25%, unemployment near 4.25%, and the S&P 500 forecast to rise 8% to 8,274 by next year.
- Warsh's credibility held up — 59% said he offered enough information and 69% said the administration's rate-cut push won't affect this month's meeting — though the share calling monetary policy independent fell 9 points.
- Continued high inflation, the Iran war and elevated oil prices ranked as the top three risks to the expansion, with 61% flagging market risk from midterm-election legal battles.
Why it matters: The Fed faces a tension flagged by respondents: rate hikes have limited power over supply-driven fuel inflation, yet CPI is forecast near 3.5% for this year. With perceptions of Warsh's independence down 9 points and oil expected to stay elevated past six months, the FOMC's Wednesday decision risks looking either insufficient against sticky inflation or ineffective against supply shocks — a credibility bind that could keep the long end of the Treasury curve under pressure.
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