Easier Policy or Inflation Risks
Economy
The upcoming leadership change at the U.S. Federal Reserve in 2026 could test the regulator’s independence and reshape expectations for global financial markets.
Federal Reserve Chair Jerome Powell’s term expires in May 2026, making the leadership transition one of the key uncertainties for the U.S. and global economy.
According to Egor Susin, Managing Director at Gazprombank Private, appointing a more dovish chair who downplays inflation risks could provide short-term economic stimulus. However, with high public debt and inflation still above target, such a move could undermine confidence in the dollar and increase market volatility.
By December 2025, the Fed had cut rates to a range of 3.5–3.75%, close to what it considers neutral. At the same time, inflation remains elevated, and internal divisions within the Federal Open Market Committee are growing.
Despite the latest rate cut, late-2025 market dynamics — rising long-term bond yields, a weaker dollar, and higher gold prices — signal investor concerns over the future direction of U.S. monetary policy.
According to Egor Susin, Managing Director at Gazprombank Private, appointing a more dovish chair who downplays inflation risks could provide short-term economic stimulus. However, with high public debt and inflation still above target, such a move could undermine confidence in the dollar and increase market volatility.
By December 2025, the Fed had cut rates to a range of 3.5–3.75%, close to what it considers neutral. At the same time, inflation remains elevated, and internal divisions within the Federal Open Market Committee are growing.
Despite the latest rate cut, late-2025 market dynamics — rising long-term bond yields, a weaker dollar, and higher gold prices — signal investor concerns over the future direction of U.S. monetary policy.
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