Fed Less Likely to Raise Rates Again in 2026 Following GDP & Inflation Data

Washington, DC, October 1, 2026—”Yesterday’s softer-than-expected inflation reading for August and a massive upward revision to Q2 gross domestic product were among the indicators that the economy is humming along-and that a second interest rate hike before 2026 ends may not be as sure of a thing anymore,” reports Morning Brew.

• The Fed’s preferred inflation gauge, the personal consumption expenditures price index, rose 0.3% for the month and 3.4% over a year ago. The top-line number is still far above the Fed’s goal of 2%, but below the 3.7% estimate from Dow Jones.
• The core rate, excluding volatile food and energy prices, was 3%, also up 0.3% for the month and below expectations.

“Meanwhile, revised data from the Commerce Department showed the GDP rose 2.2% for Q2—up from its original estimate of 1.5%. The US Bureau of Economic Analysis (BEA) also revised another metric the Fed uses to gauge underlying economic trends upward for Q2.Williams said there was ‘no urgency’ for another rate increase, and it dropped again to 41.5% after  yesterday’s data dump.”