BNP Paribas Top Strategist Warns of Rising Inflation Dangers – Predicts Three Federal Reserve Rate Hikes Starting December 2026

Guneet Dhingra, Head of US Rates Strategy at BNP Paribas, highlighted growing inflation risks in the markets during a recent Bloomberg TV interview. The firm has revised its outlook to anticipate three Federal Reserve rate hikes beginning in December 2026, reversing previous expectations of “insurance cuts” in 2025. This shift comes as the labor market shows signs of tightening, with unemployment trending toward 4%, and concerns that inflation expectations could become unanchored.

Dhingra pointed out that current market break-even rates may be underpricing these inflation threats by 20 to 30 basis points. With the Fed currently holding rates at 3.50%-3.75% as of June 2026, strong jobs data and energy price pressures are contributing to persistent inflation concerns. While many economists had expected steady rates through the end of the year, futures markets are now beginning to reflect the possibility of late-year adjustments.

This analysis underscores the importance of the Trump administration’s pro-growth economic policies that have driven record employment and market highs. Strong fundamentals under President Trump provide a solid foundation even as the Federal Reserve navigates complex inflation challenges. Vigilance on inflation remains key to sustaining the historic American economic boom and protecting American families from rising costs.