TechFlow reported that according to Jinshi Data, analysts at Citi Research expect the Federal Reserve to begin aggressive rate cuts within a few months and continue until next summer. According to a report released last Friday, Citi believes that the Federal Reserve will cut interest rates by 25 basis points at each meeting starting in September until July 2025, a total of eight rate cuts, bringing the benchmark interest rate down from 5.25%-5.5% to 3.25%-3.5%.

Citi analysts pointed out that the US economy has cooled from strong growth in 2023, and inflation has begun to slow again. The ISM service industry index has entered the contraction range and the unemployment rate has risen to 4.1%, which increases the risk of a sharp weakening of economic activity and a faster pace of interest rate cuts.

Andrew Hollenhorst, chief U.S. economist at Citigroup, said continued weakness in economic activity would prompt the Fed to cut interest rates at each of the next seven meetings. Hollenhorst also noted that a sharp economic downturn could create enough political consensus to require the government to increase spending to stimulate the economy.