
Bank of America Forecasts Three Fed Rate Hikes in 2026: What Changed in One Week and Why Markets Are Repricing
Bank of America delivered one of the sharpest forecasting reversals on Wall Street this month, telling clients on June 22 that the Federal Reserve will raise interest rates three times before the end of the year. The call — three consecutive 25-basis-point increases in September, October, and December, lifting the federal funds rate from its current 3.50%–3.75% range to 4.25%–4.50% — puts BofA well ahead of the futures market, which prices in one to two hikes at most, and sharply above the median Wall Street forecast of a single September move. The reversal is striking not just for its direction but for its speed. As recently as the prior week, BofA’s own economists had called for the Fed to hold rates unchanged through 2026. Before that, the bank had been forecasting cuts. The whiplash — from easing to holding to three hikes in a matter of months — says as much about the difficulty of modeling this inflation cycle as it does about BofA’s specific read on the data. What Triggered the Reversal The catalyst was the June 17 FOMC meeting, Kevin Warsh’s first as Federal Reserve chair. The committee voted 12-0 to hold rates steady, but the accompanying Summary













































