Barclays Holds Fed Rate Steady Until September and Warns of $85 Brent Upside
Barclays maintains Fed funds rate hold through September, forecasts 25bp cut in Sept 2026 and March 2027 while flagging upside risks to easing if inflation persists. The bank warns that delays in restoring Strait of Hormuz flows could push Brent crude above its $85/b forecast, boosting trading revenue volatility.
1. Fed Rate Outlook by Barclays
Barclays projects the Federal Reserve will keep policy rates unchanged until September 2026, basing its view on March FOMC minutes that highlighted elevated inflation concerns and downside employment risks. The bank retains a forecast for 25 basis point rate cuts in September 2026 and March 2027, but warns persistent inflation may delay its easing timeline.
2. Brent Oil Price Forecast and Risk
Barclays forecasts Brent crude will average $85 per barrel in 2026, assuming a swift normalization of flows through the Strait of Hormuz. The firm cautions that any delay in restoring traffic or further escalation in the region could push prices above its forecast, heightening volatility in oil trading revenues.