May 22 (Reuters) – Nomura expects the U.S. Federal Reserve to leave interest rates unchanged in 2026, as higher inflation and waning support among Fed officials for policy easing diminish the chances of a near-term rate reduction.
“Incoming Fed Chair Kevin Warsh is likely still motivated to ease policy, but recent data and Fedspeak make us skeptical that he will be able to convince a majority of the FOMC to go along with rate cuts,” Nomura said in a note dated May 21.
The brokerage had earlier projected two 25-basis-point interest rate cuts in September and December this year.
(Reporting by Kanishka Ajmera in Bengaluru; Editing by Harikrishnan Nair)
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