The Fed Could Raise Rates This Week — Here's What to Know
Goldman Sachs and J.P. Morgan expect the Federal Reserve to raise its main rate by a quarter point at its September 15-16, 2026 meeting. Reuters Those calls came out on September 14, one day before the meeting opened.
Morgan Stanley agrees. Matt Hornbach, global head of macro strategy at Morgan Stanley, said on September 14 he expects a 25 basis-point rise on Wednesday. Bloomberg That means a quarter point. Wednesday is day two of the scheduled meeting.
On September 12 Goldman Sachs published a piece titled 'What a Fed Rate Hike Could Mean for US Stocks' with Jonathan Shugar, head of Cross Asset Sales. Shugar said a hike may not stop U.S. stocks from rising.
Bond investors leaned that way over the summer. A Goldman Sachs briefing called 'The Outlook for the Fed' said the bond market gave a 55% chance of a September hike as of July 29.
That is a turn from Goldman's past view. Goldman Sachs Research expects cuts in June and December 2027, changed from December 2026 and March 2027 before that. Goldman Sachs That view came out on June 9, 2026. An older view from December 3, 2025 forecast two more cuts next year, to 3-3.25%.
Morgan Stanley also turned. Its 'Thoughts on the Market' series had a 'Fed Rate Cut September 2025' talk with Matthew Hornbach and Michael Gapen. It said markets gave a 90 percent chance of a September cut. It had Hornbach talking through a policy puzzle around a 25 basis-point cut. Its October FOMC meeting recap says the Fed cut by 25 basis points in October and the vote was not unanimous.
The broader context here is bigger than one meeting. Think of the Fed rate as the price of borrowing. When Wall Street shifts from expecting cuts in 2027 to a hike now, plans for savings, loans, stocks and bonds must adjust. Shugar's point is that strong company profits can still lift stocks even when borrowing costs more.
Looking at what this means for positioning, disagreement matters. The October cut was not unanimous, so a split can jolt prices around the statement, the dot plot of future rates, and the press conference. In my view, the Chair's test for another hike matters more than Wednesday alone.
