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Fed Rate Cuts Expected Amid Political Pressure in 2026

12/31/2025

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Summary

Story summary

The Federal Reserve will cut rates in early 2026, according to Mark Zandi, due to labor weakness and inflation.
Zandi expects three quarter-point cuts before midyear, contrasting with market expectations of two cuts.
Zandi says political pressure from U.S. President Donald Trump, who may appoint loyalists to the Federal Open Market Committee (FOMC), could influence Fed decisions.
The FOMC meets January 27-28, 2026, with low odds of a rate cut.

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Story summary

The Federal Reserve will cut rates in early 2026, according to Mark Zandi, due to labor weakness and inflation.
Zandi expects three quarter-point cuts before midyear, contrasting with market expectations of two cuts.
Zandi says political pressure from U.S. President Donald Trump, who may appoint loyalists to the Federal Open Market Committee (FOMC), could influence Fed decisions.
The FOMC meets January 27-28, 2026, with low odds of a rate cut.