Wells Fargo no longer expects the Federal Reserve to cut interest rates in 2026.

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Wells Fargo Investment Institute said on Monday that, given the uncertainty around inflation and rising geopolitical risks stemming from the Middle East war, the institute no longer expects the Federal Reserve to cut rates in 2026.

The Wells Fargo-affiliated institute had previously forecast that the Federal Reserve would cut rates twice this year.

A Wells Fargo strategist said, “Against the backdrop of inflation showing a clear but possibly temporary increase and heightened uncertainty, we believe the risk balance has shifted, which will prompt the Federal Reserve to take a more cautious stance.”

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Byline: Li Tong

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