Taimur Baig of DBS Research said in a report that during the current rate hike cycle, the Federal Reserve may raise interest rates twice more, once this year and the other in early 2027. The chief economist said that all members of the Federal Reserve voted to raise interest rates in September, paving the way for further rate hikes. He added: “Although inflation is largely driven by supply-side factors, there are still many risks to the inflation outlook and further action is needed.” He mentioned that Federal Reserve Chairman Walsh pointed out that the current rate of inflation falling back to the 2% target level is still unsatisfactory, and short-term interest rates are still the central tool for the Federal Reserve to carry out its policy mission. Therefore, Baig expects the terminal interest rate to reach 4.5% in the current rate hike cycle.

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