Why Barclays Still Expects Fed Rate Cuts to Arrive in 2026

Barclays economists aren’t backing down from their forecast—they’re betting on the Federal Reserve making meaningful moves in 2026 with two consecutive rate cuts. Here’s what the latest expectations look like: each cut should come in at 25 basis points, with timing penciled in for March and June next year.

The Case for Cuts: What the Data Suggests

What’s interesting is that Barclays sees the downside risk here. According to their analysis, there’s actually a greater possibility that these fed rate cut decisions get delayed compared to their baseline scenario playing out smoothly. The bank’s economists aren’t being overly optimistic—they acknowledge the uncertainty around timing.

Recent Federal Reserve meeting minutes offer some validation for this view. The December policy session minutes suggest alignment with Barclays’ thinking, and signals point toward the January meeting staying pat without surprise moves. This matches what most analysts expected: the Fed needs breathing room.

Why the Pause Makes Sense

The Federal Open Market Committee has made its reasoning clear—they require sufficient time to evaluate how the recent rate cuts have rippled through the economy. Rather than rushing into new decisions, the central bank appears to be in assessment mode. This cautious approach explains why the January meeting is shaping up to be a holding pattern, giving policymakers more data before the fed rate cut cycle potentially accelerates in spring.