Bloomberg Survey Shows Most Economists Expect No Rate Hike from Fed This Year

Bloomberg conducted a survey of 48 economists from September 4 to 9, revealing that only 13 respondents expect the Federal Reserve to raise interest rates at this month's meeting. Most economists believe that due to recent easing of inflation and the upcoming midterm elections in the U.S., policymakers will keep rates unchanged at the meetings in September and October. This expectation sharply contrasts with that of financial market investors, who currently see a 70% probability of a rate hike. This divergence reflects the uncertainty surrounding short-term monetary policy under the leadership of Fed Chair Waller, who sent a strong signal at last month's Jackson Hole central bank symposium, warning that inflation has not significantly eased. The Fed's October meeting is just days away from the November 3 midterm elections, and about half of the economists surveyed believe that the proximity of the meeting to the elections means policymakers will need to rely on "particularly strong data" to adjust rates before the elections. However, 43% of respondents still believe that the elections will not have a substantial impact on monetary policy.

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