Barclays: Fed Expected to Hike 25bps Each in September and December Following Waller's Hawkish Remarks
nashnova research
What exactly did Barclays change?
On August 31 Barclays upgraded its year-end rate forecast from "no change" to "two hikes" — 25 bp each in September and December, totaling 50 bp.
This means → Barclays believes the current rate level is not restrictive enough and needs two more turns of the screw to bring inflation down.
The trigger: Fed Chair Kevin Warsh's speech at the Jackson Hole central-bank symposium.
What did Warsh say that shifted the call?
Barclays labeled Warsh's remarks "notably hawkish" and read them as implicit backing for further tightening — even though Warsh himself declined to offer explicit forward guidance.
Warsh's core message: inflation remains too high, financial conditions are not yet restrictive, the labor market is consistent with full employment, and price stability is the top priority.
In plain terms = Warsh never said "we will hike," but he lined up every argument that supports one — and the market heard the subtext.
Doesn't Barclays' own inflation forecast lean soft?
Barclays concedes that its own monthly inflation projections point to "notably softer" readings, diverging from the longer-run inflation gauges Warsh emphasized.
Yet the bank argues that unfavorable base effects will keep suppressing those gauges through year-end.
This means → even if near-term inflation data dip, the decline may be an illusion created by a high year-ago base rather than genuine cooling — and that is exactly the logic anchoring Barclays' hike call.
How is the market pricing this?
Per the CME FedWatch tool, fed-funds futures now imply a 60.4% probability of a September hike.
After Warsh's speech, investors markedly increased their bets on a September move.
The market's focal point has shifted to the September 16 Fed policy meeting — when the answer arrives.
市场有风险，内容仅供研究参考，不构成投资建议。