Bank of America’s Brian Moynihan Outlines Three Fed Rate Hikes in 2026 as Inflation Turns ‘Mid-2s’ by End of 2027

Bank of America CEO Brian Moynihan said he expects the Federal Reserve to raise interest rates three times in 2026, and he projected that inflation could be in the “mid-2s” by the end of 2027. Speaking on CNBC, Moynihan framed his outlook around a pattern he sees in recent inflation dynamics, saying price pressures had been easing before picking up again.

Moynihan attributed the renewed inflation pressure to the effects of tariffs and what he described as a “war on prices,” language used to characterize attempts by companies and retailers to keep price levels in check or adjust pricing strategies under consumer pressure. He said those forces have been contributing to the inflation level moving in the wrong direction, even as earlier trends pointed to improvement.

The CEO added that the tariff and pricing-related pressures are now starting to subside, which he linked to his view that inflation can continue to drift back toward the Fed’s preferred range over time. In his characterization, the near-term inflation path is shaped less by broad-based economic overheating and more by specific policy and pricing influences that can move with lags.

Moynihan’s comments come at a time when market participants are actively trying to translate the Fed’s policy intentions into a timeline for rates and inflation. His specific reference point of three hikes in 2026 offers a concrete path, even as central bank decisions depend on incoming data and policy deliberations rather than on a single bank executive’s forecast.

For Bank of America, the interest-rate environment is more than a macro headline. Rates influence the profitability and pricing of core banking products, including interest income tied to loans and securities, as well as deposit costs that adjust as customers respond to available yields. A shift in expectations for the pace of rate changes can also affect how investors price bank earnings trajectories, even without changes to a bank’s underlying credit fundamentals.

The CEO’s “mid-2s” inflation projection is also notable because it points to a gradual normalization rather than an immediate return to target. Inflation in the mid-2 percent range, as he described it, generally implies that policy would not need to stay restrictive indefinitely. For banks, that matters because the ultimate level and duration of rates can affect credit performance, loan demand, and the market value of interest-rate-sensitive portfolios.

Still, the CNBC exchange did not provide detailed quantitative support beyond the inflation direction and the Fed-hike count. It also did not outline what inflation measure he had in mind, how quickly tariffs and pricing pressures would fade, or how he expects those factors to interact with labor and growth trends. As a result, investors looking for a fuller policy path, including timing by meeting and the expected peak rate, did not receive those specifics in the cited remarks.

Going forward, what to watch is whether incoming inflation and policy data confirm Moynihan’s assumption that tariff-related and pricing-related effects are diminishing as he expects. Additional clues could come from how banks report interest-rate assumptions, how credit metrics evolve under a higher-for-longer backdrop, and whether the Fed’s communications align with the three-hike framework the Bank of America CEO laid out for 2026.