BNP Paribas SA expects the Fed funds rate to rise into Q1 2027, with three hikes
between Sep 2026 and Jan 2027. The bank cites healthy growth, persistent fiscal
deficits and a surge in very large corporate issuance as upward pressure on
long-term yields, which should flatten the yield curve. Analysts say the small
tightening cycle should peak in Q1 2027, after which markets will digest Fed
credibility and push yields modestly lower from Q2 2027.
