PGIM, in a dissenting view, expects the Fed to raise rates three times this year to curb an overheating US economy, then reverse course with three cuts in 2027 and a further cut in 2028, bringing the policy rate to 3.375% — below current levels and near neutral. The firm, which in April had forecast cuts this year, cites an "unusually strong" US economy, persistently high inflation and five years of missing the Fed's 2% target as the rationale for pre-emptive hikes to shore up credibility and an

PGIM, in a dissenting view, expects the Fed to raise rates three times this year to curb an overheating US economy, then reverse course with three cuts in 2027 and a further cut in 2028, bringing the policy rate to 3.375% — below current levels and near neutral. The firm, which in April had forecast cuts this year, cites an "unusually strong" US economy, persistently high inflation and five years of missing the Fed's 2% target as the rationale for pre-emptive hikes to shore up credibility and anchor inflation expectations. PGIM adds that framing hikes as preventive against supply-side inflation and recent long-term Treasury volatility would help secure political support.