Bond Market Shifts Expectations for Four More Rate Hikes by 2027

The bond market has undergone a dramatic shift in its expectations for Federal Reserve interest rate hikes. As of September 29, 2026, futures markets are pricing in four additional 25 basis point rate hikes by June 2027, totaling +125 basis points including the recent hike.

This represents a significant reversal from nine months ago, when the same market was anticipating at least 100 basis points of rate cuts over the same period. The net swing is an impressive +225 basis points in expected Fed policy, moving from deep easing to aggressive tightening within a year.

The implications for risk assets are clear: higher borrowing costs will compress valuations across equities and crypto simultaneously. When the bond market moves this aggressively, it sets the floor for discount rates across every asset class, putting pressure on the US 10-year yield.