HSBC: Developed Markets Unlikely to Cut Rates in 2026 as Middle East Conflict Boosts Inflation

GateNews
HSBC1.87%
According to Jin10, HSBC Private Bank's mid-term investment outlook, released on May 27, shows that markets have essentially cancelled expectations for rate cuts in developed markets this year due to Middle East tensions. HSBC agrees the Federal Reserve should hold rates steady in 2026. The bank forecasts the Bank of England will raise rates twice (25 basis points each) and the European Central Bank will hike three times in 2026, as regional exposure to energy price shocks from the conflict weighs on growth and lifts inflation risks.
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