Barclays Forecasts Fed Rate Hikes: Two Increases Expected in 2026

Barclays' expectation of two interest rate hikes in 2026 could reinforce a hawkish perception of the Fed in markets, potentially dampening global risk appetite. This scenario may lead to capital outflows and currency pressure, particularly in emerging markets and fragile economies like Turkey. In the short term, selling pressure in equity markets and a rise in bond yields could be observed. However, the fact that these expectations point to a distant date may keep the impact limited, allowing markets to continue pricing in the current situation.

The news strengthens expectations that the Fed will raise interest rates in 2026, which is a supportive factor for the dollar index (DXY). Technical indicators also confirm this outlook; the RSI shows strong momentum at 65, while the price is trading above the SMA20 and SMA50. Although the MACD is just below the signal line, it remains in positive territory, keeping the risk of a short-term correction limited. However, the RSI approaching overbought territory could temper the pace of the rally, so cautious optimism is warranted.

Barclays' expectation of two interest rate hikes in 2026 contradicts the market's current pricing of rate cuts, which could dampen risk appetite. This news may particularly create selling pressure on growth stocks and could cause the index to turn from sideways to negative in the short term. In technical indicators, the RSI being in the neutral zone and the MACD remaining below its signal line indicate weak momentum. Although the price being above the SMA20 and SMA50 supports the medium-term trend, the rate hike news could weaken this support in the short term. Therefore, in a 1-3 day perspective, the index appears more likely to move downward.

Barclays' expectation of two interest rate hikes in 2026 runs counter to the market's current pricing of rate cuts, which could dampen risk appetite. The NDX's RSI is in neutral territory (51.4) and below the MACD signal line, indicating weakening short-term momentum. The price is just above the SMA20, but with this news, the likelihood of testing this support level may increase. While technical indicators do not provide a clear direction, the news flow creates a negative bias. Therefore, a limited decline can be expected over a 1-3 day horizon.