# Citigroup Federal Reserve and market outlook > Live situation record from CLSTR: https://clstr.news/situations/citigroup-federal-reserve-and-market-outlook > Updated: 2026-09-08T13:42:18.000Z. Sources: 17. Developments: 2. Citigroup has adjusted its economic outlook regarding Federal Reserve monetary policy and its impact on global markets. Following stronger-than-expected U.S. employment data, the bank revised its interest rate forecast, delaying expectations for the next 25-basis-point reduction to June 2027. Economists Andrew Hollenhorst and Veronica Clark suggested that a resilient labor market might cause policymakers to prioritize the inflation outlook over employment stability. In a separate analysis of market performance, Citigroup reported that U.S. equities historically underperform by an average of nearly 2% immediately following the first interest rate hike of a tightening cycle. During these periods, international markets such as those in Japan and the United Kingdom have historically outperformed U.S. stocks. While futures markets indicated a 60% probability of a rate hike in September, analysts did not project immediate increases. ## Timeline ### 2026-09-08: Citigroup: Japanese and UK stocks outperform U.S. after Fed rate hikes Citigroup reports that U.S. stocks typically underperform by 2% following the first Fed rate hike, while markets in Japan and the UK often see gains of 2% to 3% during the same period. 3 sources. https://clstr.news/cluster/citigroup-japanese-and-uk-stocks-outperform-us-after-fed-rate-hikes ### 2026-09-04: Citigroup delays Fed rate-cut forecast to 2027 Citigroup has delayed its Federal Reserve interest rate cut forecast to 2027, citing strong U.S. employment data that suggests a resilient labor market and a shift in focus toward inflation. 14 sources. https://clstr.news/cluster/citigroup-delays-federal-reserve-rate-cut-forecast-to-2027 --- Cite as: Citigroup Federal Reserve and market outlook. CLSTR, https://clstr.news/situations/citigroup-federal-reserve-and-market-outlook