UBS has adjusted its Federal Reserve outlook after September's inflation data exceeded expectations, with headline CPI reaching 3.7% year-over-year. The bank now anticipates a total of three rate hikes from the Federal Reserve: in September and December 2026, and March 2027, after which the Fed will pause rate increases until late 2027. UBS stated that inflationary pressures are spreading from the energy sector to goods and services. The market is currently pricing in nearly five rate hikes, indicating that investors expect a more aggressive tightening policy from the Federal Reserve.