Fidelity Predicts 1 U.S. Rate Cut in 2026, But Risks Favor No Action Amid Middle East Tensions

According to Fidelity International, U.S. interest rate outlook for the remainder of 2026 will depend on Middle East conflict duration, senior global macro strategist Max Stainton said in a report. While Fidelity's base case remains slightly more dovish than market pricing, the firm predicts one rate cut this year but risks are clearly tilted toward no action as risks of prolonged Strait of Hormuz closure rise, potentially spreading energy shocks into broader inflation pressures.
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