Bank of America Sees No Fed Rate Relief Until 2026

Bank of America strategists now believe the Federal Reserve won’t cut interest rates in 2025. Citing slower-than-expected job growth and a gradually rising unemployment rate—forecast to reach 4.4% by year-end—the team argues there’s little “compelling case” for rate reductions.

With tariffs possibly lifting consumer prices and core inflation poised to hit 3% this summer, the Fed is likely to keep its policy rate at 4.25–4.50% until at least next year.