UBS Adjusts Federal Reserve Rate Forecast After Impressive Job Growth

UBS Global Wealth Management now expects the Federal Reserve to increase interest rates by 25 basis points in both September and December following robust job growth in August. Initially anticipating no change, UBS highlights the impact of Chair Kevin Warsh's speech, inflation risks, and strong labor data.

UBS Global Wealth Management has revised its forecast, anticipating that the Federal Reserve will raise interest rates by 25 basis points in September and December. This follows a stronger-than-expected jobs report for August.

The firm previously did not foresee any policy change this year, but recent developments have shifted this outlook.

UBS cited hawkish remarks, particularly from Fed Chair Kevin Warsh at the Jackson Hole conference, along with supply chain-related inflation risks and robust labor data, as reasons for its updated prediction.