Huatai Securities says after the Fed’s September hike, December is likely the
next substantive policy window and whether the Fed reopens a rate-hike cycle
will depend on further data and officials’ remarks. Markets currently price a
>50% chance of an October move, but Huatai judges the need for an October hike
reduced given a waning fiscal impulse, oil-driven weakness in household
consumption, tighter financial conditions and the prospect that employment and
inflation may cool over the next 1–2 months. Huatai’s base case is for another
hike in December. The Fed’s 2027 path will hinge on incoming economic
data—especially whether the labor market sustains improvement that drives wage
growth and on subsequent inflation dynamics.
