BofA Global Research said it now expected two more quarter percentage point interest rate hikes from the US Federal Reserve this year, taking its terminal rate forecast to 5.5% to 5.75%. BofA earlier expected the terminal rate to be held at the current 5%-5.25% range, but the change in forecast comes after the Fed kept its key rate unchanged in the 5%-5.25% on Wednesday (June 14), but signalled two more hikes might be needed in 2023 to tame inflation. The research firm said in a note late Wednesday that it now expects the Fed to increase rates in July and September, and also pushed out its rate-cut expectation to May 2024, from an earlier expectation of a cut in March.

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