Bank Of America Predicts Fed Rate Cut In September
According to Odaily, Bank of America has revised its monetary policy outlook following weaker-than-expected data, including the ISM Manufacturing Report and the July non-farm payroll report. The bank now anticipates that the Federal Reserve will implement a 25 basis point rate cut at its September meeting. This adjustment reflects a broader expectation of gradual monetary easing by the Fed.In addition to this forecast, Bank of America has also lowered its expectations for the terminal rate of the upcoming normalization cycle. The bank now projects the terminal rate to be between 3.25% and 3.5%, a reduction of 25 basis points from previous estimates. This adjustment is based on the assumption that the economy may cool faster than anticipated by both the bank and the Federal Reserve, potentially reducing the need for a prolonged high-interest-rate policy stance.