ChainCatcher reported that JPMorgan economists reiterated their expectation that the Federal Reserve will cut interest rates by 50 basis points at its policy meeting next week amid falling inflation and weak employment data. "We think it is clear what the Fed should do next week, which is to cut interest rates by 50 basis points to accommodate changes in the balance of risks," Michael Feroli, the bank's chief U.S. economist, wrote in a report on Friday.
Michael Feroli expects the Fed's latest median quarterly forecast for the policy rate at the end of this year to be 100 basis points lower than the forecast in June, which means two more 25 basis point rate cuts in 2024; he expects the median expectation for interest rates to be another 150 basis point cut by the end of 2025. Michael Feroli wrote that if the Fed only cuts by 25 basis points next week, the median rate cut this year may be only 75 basis points.
