Wells Fargo Predicts Multiple Fed Rate Cuts by Mid-2026

According to BlockBeats, Wells Fargo anticipates that the Federal Reserve will implement five interest rate cuts of 25 basis points each by mid-2026. The bank expects three consecutive rate cuts in upcoming meetings, reducing rates to a range of 3.50% to 3.75% by the end of the year. Further reductions are projected for March and June 2026, bringing the rate range down to 3.00% to 3.25%. This outlook is influenced by a weakening labor market, with average job growth in August at just 29,000 and an unemployment rate increase to 4.3%. Inflation remains a challenge, with the core Personal Consumption Expenditures (PCE) index rising 2.9% year-over-year. Wells Fargo notes that inflation expectations are stable, raising the likelihood of a U.S. recession next year to 35%. However, the bank forecasts stronger economic growth in the coming years, predicting a GDP growth rate of 2.4% in 2026 as fiscal stimulus and rate cuts take effect.