What will the Federal Reserve do in 2026? The market is currently entangled in two conflicting narratives.
On one hand, the data is clear. The US third-quarter GDP growth rate reached 4.3% annualized, a figure that is quite robust—demonstrating the economy's resilience, which has exceeded many expectations. Against this backdrop, the necessity of Fed rate cuts naturally comes into question.
On the other hand, major institutions also have their voices. BlackRock's strategy analysts Amanda Lynam and Dominique Bly jointly released a report stating that, based on the current market situation, the Federal Reserve's rate cuts in 2026 are expected to be quite restrained, with no aggressive moves. Considering that this cycle has already seen a total of 175 basis points of rate cuts, the room and need for further easing are diminishing.
This tug-of-war is clearly affecting traders and investors—strong economic data supports hawkish expectations, while institutional analysis hints that the room for rate cuts is limited. The two narratives continue to battle in the market, and how it ultimately unfolds will depend on the upcoming inflation data and employment figures signaling what’s next.
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ResearchChadButBroke
· 2025-12-27 11:23
These GDP figures are really solid, but the Federal Reserve still has to watch inflation's face.
Wait, they cut by 175 basis points and still want to continue? Greedy, everyone.
Two conflicting logics, retail investors are ultimately just the little guys.
The economy's resilience seems a bit overhyped.
The room for rate cuts is at its limit, now this is getting interesting.
Hawks and doves are fighting each other all day, but no one is thinking about how retail investors will survive.
Inflation data is the real key, everything else is nonsense.
BlackRock says to hold back, but I think they want to stay steady.
A strong economy = no rate cuts, I can't quite handle this logic.
The next step depends on how the employment data performs; a big show is coming.
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AllInDaddy
· 2025-12-27 05:20
These GDP figures are indeed impressive, but the room for interest rate cuts is really about to hit the bottom.
Wait a minute, with such repeated tug-of-war, how can retail investors play...
I trust BlackRock's analysis on this wave; after a 175bp rate cut, they still want to be aggressive? That's hilarious.
Strong economic resilience is a good thing, but for our trading strategies, it actually makes judgment more difficult.
The inflation data is the key; everything else is just floating clouds.
With such indecisiveness, who dares to hold heavy positions? It's better to wait for signals.
The hawkish stance and rate cut expectations are at odds, and we're caught in the middle, which is truly uncomfortable.
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JustAnotherWallet
· 2025-12-25 23:30
It's the same old story of "Strong Economy vs. Limited Rate Cuts," wobbling until 2026.
GDP data is solid, but it shouldn't be taken too seriously... Who knows what the Fed folks are really thinking.
Does BlackRock say to hold back? Why does it feel like all institutional analyses are armchair quarterbacks after the fact?
All 175 basis points have been cut, what else is there to do? This time, there might really be no bullets left.
Let's wait for the inflation data. Anyway, whatever is said now is pointless. Let's see how the year-end plays out.
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MeaninglessApe
· 2025-12-24 14:12
Sounds like the Fed is about to play that "want and need" game again, huh?
Anyway, I've already bet my money on inflation data. No matter how strong GDP is, it can't withstand an unexpected CPI.
BlackRock says they will be restrained? These people have never told the truth.
It's too early to talk about the story in 2026. Better to wait and see what the December decision will be.
They've already cut 175 basis points and still want to cut more? That's hilarious. The market is dreaming.
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GasWastingMaximalist
· 2025-12-24 14:11
4.3% GDP growth rate is no joke, but this time the Fed is probably going to slack off again.
The room for rate cuts has been fully squeezed out, and the room for action in 2026 is indeed limited...
It's again the strong hawkish economy versus the restrained institutional camp, and this drama in the market will continue.
Inflation data is the real key, everything else is just floating clouds.
The more fiercely these two factions fight, the more it shows that no one has truly got a handle on it.
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ApeWithNoChain
· 2025-12-24 14:11
It's the same old trick again. As soon as the economic data is released, someone calls for a hawkish stance, and then institutions sing a different tune. Who the hell is really in charge?
The room for rate cuts is limited... 175bp has already been cut, what more do you want? Might as well just lie flat.
Before the inflation and employment data come out, it's all talk. Anyway, both bulls and bears have their say.
After this 175bp cut, I feel like I've been played several times. Now I trust half of the analysis and doubt the other half.
The market just loves to keep messing around like this. We traders are just waiting to be harvested.
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FantasyGuardian
· 2025-12-24 14:10
Here we go again, if GDP is strong, they won't cut interest rates; if there's little room to cut, they won't cut. Why doesn't the Fed just stop cutting?
175 basis points have already been cut, what are they still hesitating about? I really can't understand these institutions.
Economic data may be tough, but inflation still needs to be lowered. Don't be too optimistic.
Blackstone says to be restrained? They know exactly what the market truly needs.
Just wait and see. Anyway, there will always be surprises and shocks, you can never guess right.
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LuckyBlindCat
· 2025-12-24 14:07
This GDP number is being stubborn here, does the Federal Reserve still want to cut interest rates? Haha
There’s no room left for rate cuts, BlackRock’s statement is spot on
Economic resilience is actually a trap, they can’t cut anymore
175 basis points and still want to play, the Fed is really something
Both sides are betting, let’s see who concedes first
Inflation data is the real boss, everything else is useless
Strong data doesn’t necessarily mean good news, this time it might really be stuck
Just wait and see, anyway I can’t predict correctly
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Layer3Dreamer
· 2025-12-24 13:50
theoretically speaking, if we model the fed's 2026 trajectory as a recursive constraint optimization problem... the 175bps cumulative cut already suggests we're hitting diminishing returns on the monetary policy vector. that 4.3% gdp reading is basically a state commitment that makes further easing mathematically less elegant, ngl.
What will the Federal Reserve do in 2026? The market is currently entangled in two conflicting narratives.
On one hand, the data is clear. The US third-quarter GDP growth rate reached 4.3% annualized, a figure that is quite robust—demonstrating the economy's resilience, which has exceeded many expectations. Against this backdrop, the necessity of Fed rate cuts naturally comes into question.
On the other hand, major institutions also have their voices. BlackRock's strategy analysts Amanda Lynam and Dominique Bly jointly released a report stating that, based on the current market situation, the Federal Reserve's rate cuts in 2026 are expected to be quite restrained, with no aggressive moves. Considering that this cycle has already seen a total of 175 basis points of rate cuts, the room and need for further easing are diminishing.
This tug-of-war is clearly affecting traders and investors—strong economic data supports hawkish expectations, while institutional analysis hints that the room for rate cuts is limited. The two narratives continue to battle in the market, and how it ultimately unfolds will depend on the upcoming inflation data and employment figures signaling what’s next.