Data compiled by Woofun AI shows that a survey of 47 economists, conducted jointly by the Financial Times and the University of Chicago Booth School of Business' Rustandy Center, indicates that more than half anticipate the Federal Reserve will raise interest rates by at least 25 basis points by the end of 2026. This outlook aims to address the persistent inflation level nearing 3.8%, marking a sharp divergence from the consensus in early March, which favored rate reductions. Despite geopolitical developments, such as the U.S.-Iran peace agreement potentially easing energy prices via the Hormuz Strait, respondents argue that inflationary pressures will continue to permeate the real economy for an extended period.

Concurrently, market sentiment suggests that the first FOMC meeting under newly appointed Fed Chair Powell will likely maintain current interest rates.

However, internal support for future tightening is growing, driven by a resilient U.S. labor market and broader economic strength. Joe Lavorgna, Chief Economist for the Americas at Sumitomo Mitsui Banking Corporation and former advisor to U.S. Treasury Secretary Mnuchin, emphasized that President Trump's calls for rate cuts will not sway Powell's data-dependent policy decisions.

Furthermore, nearly 70% of surveyed economists warn of a heightened probability of an S&P 500 decline exceeding 20% within the next year, citing structural bubble risks in overvalued technology stocks, particularly within the semiconductor sector.