Major Wall Street Banks Postpone Expected Interest Rate Cuts Following Resilient Labor Data
Leading financial institutions have revised their interest rate forecasts after December employment data showed a resilient labor market in the United States.
Insights:
Several major investment banks in the US 
UShave significantly adjusted their monetary policy projections as of January 12, 2026. Following the latest employment figures, institutions including JPMorgan Chase & Co. , Goldman Sachs Group Inc. , and Morgan Stanley have postponed their expectations for interest rate reductions by the Federal Reserve until mid-2026 or later. This reassessment was largely prompted by data released on Friday, January 10, which indicated that while employment growth slowed more than expected in December, the labor market in the USremains fundamentally resilient.
UShave significantly adjusted their monetary policy projections as of January 12, 2026. Following the latest employment figures, institutions including JPMorgan Chase & Co. , Goldman Sachs Group Inc. , and Morgan Stanley have postponed their expectations for interest rate reductions by the Federal Reserve until mid-2026 or later. This reassessment was largely prompted by data released on Friday, January 10, which indicated that while employment growth slowed more than expected in December, the labor market in the USremains fundamentally resilient.The employment report showed the unemployment rate in the USdeclining to 4.4 percent alongside solid wage growth. These indicators suggest that the labor market is not experiencing a rapid deterioration, which has bolstered expectations that the Federal Reserve will leave interest rates unchanged during its upcoming meeting in late January. Investors tracking the Financial Select Sector SPDR Fund and the iShares 20+ Year Treasury Bond ETF are closely monitoring these shifts in the interest rate environment.
