JPMorgan and Citi have revised their forecasts and now expect the Federal Reserve to implement a series of rate cuts starting in September 2024. Both banks anticipate a total reduction of 125 basis points by the end of the year. This comes in response to recent economic data indicating a slowdown, with inflation easing and unemployment rates showing signs of an upward trend​.

The probability of a 50 basis point cut in September was previously low, estimated at just 11%. However, the latest economic indicators, including a cooling labor market and weaker service-sector performance, have prompted a significant shift in expectations​​. According to Citi, the Federal Reserve is expected to cut interest rates by 50 basis points in both September and November, followed by a 25 basis point cut in December​​. JPMorgan echoes this sentiment, citing the need to address the economic slowdown and stimulate growth​.

Both banks emphasize that the Federal Reserve’s decision will be influenced by the latest economic data, with potential adjustments based on evolving economic conditions​. The projected rate cuts aim to mitigate the impact of slowing economic growth and help stabilize the market​​.

Disclaimer: Bitcoin Versus is not a financial advisor. This media platform reports on financial subjects purely for educational and entertainment purposes only. Do your own due diligence and contact a professional financial advisor for any advice on how to invest your money.