NEWS AND INSIGHTS | INSIGHTS

CIO Notebook: Fed Stands Firm as Powell’s Successor Waits in the Wings

一月 28, 2026
Shannon Saccocia, CFA, 首席投資總監 — NB私募財富

We remain constructive on risk assets, favoring small and mid-cap equities, upgrading emerging market equity, adding to non-U.S. developed and emerging market debt, and maintaining overweights in commodities and private equity while staying neutral on private credit.

As expected, the Federal Open Market Committee (“FOMC”) held the fed funds target rate steady at 3.50% to 3.75% following their January meeting. After three dissents in the December meeting, only Christopher Waller and Stephen Miran dissented this meeting, with both calling for a 25-basis point cut. This marks the fourth straight dissent for the recently appointed governor whose term expires this Saturday, although there is no current word on the potential or timing of a replacement. As for Waller, while he is one of a small group of finalists to replace Fed Chair Jerome Powell, he has been on record with his continued concerns about the labor market. Worth noting, the Fed also added four new voters to the mix – Cleveland Fed President Beth Hammack, Philadelphia Fed President Anna Paulson, Dallas Fed President Lorie Logan, and Minneapolis Fed President Neel Kashkari. Cycling off were Susan Collins, Alberto Musalem, Austan Goolsbee, and Jeffrey Schmid.

There were some important, albeit not unpredicted, changes to the Fed’s statement. The FOMC noted that economic activity has accelerated at a “solid pace” and while job gains have remained low, there have been “signs of stabilization” in the labor market. In addition, the statement pointed to a still elevated level of inflation but did not elaborate further on the trend. On closer inspection, it would appear that the FOMC has become more comfortable with the belief that the labor market is not on the precipice of further deterioration. While job gains have been admittedly underwhelming, there has been little growth in the supply of labor as well, which is helping to maintain a better balance than one would expect given the trailing three month average for non-farm payrolls stands at -22k. Overall, the statement pointed to a more balanced view of the risks to the Fed’s dual mandate.

During the press conference, Powell acknowledged several concerns: housing has been “weak”, hiring is “low”, and the demand for workers has “clearly softened.” However, Powell reinforced the slightly more hawkish statement, stating that the Fed sits today within the estimates of the neutral range, albeit at the higher end in the eyes of some voters. For those looking for some dovish signs, Powell did state that the Fed continues to see tariff inflation as “one-time” and stated that “a lot of” the pass through of higher tariffs has already occurred. This points to the ability for the Fed to act more decisively on any weakening in the labor market, akin to the actions the Fed took in 2025.

In addition to queries related to monetary policy, Powell fielded several questions about his recent attendance of the oral arguments in Governor Lisa Cook’s case before the Supreme Court, political pressure on the Fed and the DOJ case, his plans after his term as Chair concludes in May, and his views on the dollar – all of which resulted in no new information. He did state that he believes the Fed has maintained its credibility and that he and other Fed officials are committed to Fed independence, advising his successor to “stay out of elected politics” and remain engaged with Congress.

Today’s meeting did little to move markets or change minds on the path of rate cuts. With another one to two rate cuts likely this year, and a global economy that is reaccelerating, our view on risk assets remains constructive. We are leaning into small and mid-caps and have upgraded emerging markets – especially India and Brazil – on better growth prospects and cheaper valuations. We are encouraging reallocating cash and recommend adding exposure to non U.S. developed bonds and emerging market debt, where valuations and policy backdrops look more attractive. Within alternatives, we remain overweight commodities (notably gold and other precious metals) and private equity, while staying neutral on private debt given rising credit risks.

play
Municipal Basis Points 1Q 2026
MUNICIPAL BASIS POINTS

Buckle Up

一月 22, 2026

IMPORTANT INFORMATION:

This material is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. This material is general in nature and is not directed to any category of investors and should not be regarded as individualized, a recommendation, investment advice or a suggestion to engage in or refrain from any investment-related course of action. Any views or opinions expressed may not reflect those of the firm as a whole. Neuberger Berman products and services may not be available in all jurisdictions or to all client types. Diversification does not guarantee profit or protect against loss in declining markets. Investing entails risks, including possible loss of principal. Investments in private equity are speculative and involve a higher degree of risk than more traditional investments. Investments in private equity are intended for sophisticated investors only. Unless otherwise indicated, returns shown reflect reinvestment of dividends and distributions. Indexes are unmanaged and are not available for direct investment. Investing entails risks, including possible loss of principal. Past performance is no guarantee of future results.

Portfolio positioning views expressed herein are those of Neuberger Berman’s Private Wealth Investment Group, which may include those of the Neuberger Berman’s Asset Allocation Committee. Asset allocation and positioning views are based on a hypothetical reference portfolio. The Private Wealth Investment Group analyzes market and economic indicators to develop asset allocation strategies. The Private Wealth Investment Group works in partnership with the Office of the CIO. The Private Wealth Investment Group also consults regularly with portfolio managers and investment officers across the firm. The Asset Allocation Committee is comprised of professionals across multiple disciplines, including equity and fixed income strategists and portfolio managers. The Asset Allocation Committee reviews and sets long-term asset allocation models, establishes preferred near-term tactical asset class allocations and, upon request, reviews asset allocations for large, diversified mandates. Asset Allocation Committee members are polled on asset classes and the positional views are representative of an Asset Allocation Committee consensus. The views of the Asset Allocation Committee and the Private Wealth Investment Group may not reflect the views of the firm as a whole and Neuberger Berman advisers and portfolio managers may take contrary positions to the views of the Asset Allocation Committee or the Private Wealth Investment Group. The Asset Allocation Committee and the Private Wealth Investment Group views do not constitute a prediction or projection of future events or future market behavior. Defensive positioning generally means an underweight bias on allocations to risk assets such as equities and alternatives. Positioning views may change over time without notice and actual client positioning may vary significantly. Discussion of yield characteristics or total returns of different asset classes are for illustrative purposes only. Such asset classes, such as equities and fixed income, may have significantly different overall risk-return characteristics which should be consider before investing.

The information in this material may contain projections, market outlooks or other forward-looking statements regarding future events, including economic, asset class and market outlooks or expectations, and is only current as of the date indicated. There is no assurance that such events, outlook and expectations will be achieved, and actual results may be significantly different than that shown here. The duration and characteristics of past market/economic cycles and market behavior, including any bull/bear markets, is no indication of the duration and characteristics of any current or future be market/economic cycles or behavior. Information on historical observations about asset or sub-asset classes is not intended to represent or predict future events. Historical trends do not imply, forecast or guarantee future results. Information is based on current views and market conditions, which will fluctuate and may be superseded by subsequent market events or for other reasons.

Discussions of any specific sectors and companies are for informational purposes only. This material is not intended as a formal research report and should not be relied upon as a basis for making an investment decision. The firm, its employees and advisory accounts may hold positions of any companies discussed. Nothing herein constitutes a recommendation to buy, sell or hold a security. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. Investment decisions and the appropriateness of this content should be made based on an investor's individual objectives and circumstances and in consultation with his or her advisors.

Neuberger Berman Investment Advisers LLC is a registered investment adviser.

The “Neuberger Berman” name and logo are registered service marks of Neuberger Berman Group LLC.