UBS Raises Fed Rate Hike Forecast: Another Hike by March 2027
nashnova research
UBS now expects the Fed to hike a third time in March 2027, stretching the tightening cycle well beyond what markets had priced — a signal that inflation pressure is broader and stickier than assumed.
What exactly is UBS calling?
UBS Global Wealth Management on Wednesday added a 25-basis-point hike in March 2027 to its forecast — the third of this cycle.
The prior two: September's 25 bp hike (already delivered, the first since 2023) and a December 25 bp hike still ahead.
This means → UBS sees the hiking cycle not as a one-off tap but as a rising slope spanning at least six months.
Why raise the forecast now — what did September CPI show?
The trigger: September CPI came in above expectations, showing price pressure spreading across categories.
UBS economist Andrew Dubinsky wrote: "Goods inflation strengthening alongside persistent services inflation supports the Fed's 'higher for longer' stance."
In plain terms = it is not just oil and food rising — services prices have not come down either, so inflation is burning on two fronts.
Beyond CPI, what other forces are pushing?
UBS flagged three overlapping pressures: AI-driven demand expansion, Middle East geopolitical supply-chain disruption, and trade-policy uncertainty.
With inflation hovering near 3% under these compounding shocks, the extended hiking path aims to "keep inflation expectations anchored."
This reflects a Fed facing not a single shock but multiple pressure lines at once — relief on any one alone is not enough to ease policy.
How is the market pricing this — and which date matters most?
CME FedWatch puts the October hike probability at about 27%, up from 21.6% before the CPI print — still restrained.
December is nearly fully priced at 89.5% — little suspense there.
This means → the real uncertainty sits at March 2027: whether the third hike materialises depends on inflation and jobs data over the coming months.
市场有风险，内容仅供研究参考，不构成投资建议。