BofA adds January Fed hike after hot October CPI
In short
BofA Global Research now expects the Federal Reserve to raise rates in January 2027. It made the call after a hotter-than-expected October Consumer Price Index reading and is looking for a 25-basis-point hike.
The change shows that recent inflation data is pushing big banks to rethink the Fed’s next move. Goldman Sachs and Deutsche Bank have also changed their forecasts.
What the reporting says
BofA Global Research added a January 2027 Fed rate hike to its forecast after an unexpectedly high October Consumer Price Index report. The bank now expects a 25-basis-point increase, citing rising inflation pressures from several factors. The revised view comes as Goldman Sachs and Deutsche Bank also adjusted their forecasts after recent data. The move underscores how stronger inflation readings are shifting market expectations for U.S. rates.
Why it matters
BofA Global Research shifted its U.S. rate outlook and now sees the Federal Reserve raising rates in January 2027 after an unexpectedly high October CPI reading. The bank expects a 25-basis-point hike, pointing to broader inflation pressure. The revised forecast matters for bond, equity and rate markets because it suggests tighter policy may last longer than previously assumed.