Federal Reserve, Powell face challenges in 2026
CNBC••business
Key Points:
- The Federal Reserve enters 2026 with significant political and policy challenges, including a new chair appointment, ongoing inflation pressures, and an economy influenced by both growth-supporting tailwinds and restrictive headwinds.
- After three consecutive interest rate cuts, the Fed is expected to adopt a cautious approach in 2026, with limited further reductions likely due to solid economic growth and persistent inflation concerns.
- Political tensions remain high, with a Supreme Court hearing on former President Trump’s authority to remove Fed Governor Lisa Cook scheduled for January, alongside the Fed’s interest rate decision and the announcement of a new Fed chair.
- Economic experts predict between one to three interest rate cuts in 2026, but the Fed emphasizes data-driven decisions amid a strong economy bolstered
