21 Giant Banks Predicted When and How Much the Fed Will Cut Interest Rates

Following the Fed’s decision to keep interest rates steady, many major US banks revised their interest rate forecasts. Here’s a summary of his latest predictions:

Bank of America predicts that the first reduction will be made in December 2024 and a total reduction of 25 basis points (BPS) will be made throughout the year. Barclays and BNpp share similar views and estimate that the first reduction will be made in September and December, respectively, and a 25 basis point reduction will be made in 2024.

Citigroup expects an earlier and larger reduction, estimating that the first reduction will be made in July 2024 and that there will be a total reduction of 100 basis points during the year. While Deutsche Bank foresees a more conservative reduction, it estimates that the first reduction will be made in December and a total reduction of 25 basis points will be made in 2024.

Evercore ISI and Goldman Sachs predict that the first interest rate cut will be made in September 2024 and that there will be a 50 basis point reduction throughout the year. HSBC also expects the first reduction to be made in September, but a total reduction of 25 basis points in 2024.

Jefferies and Mizuho take a different approach and do not foresee any discounts until 2025. JP Morgan expects the first reduction to be made in July 2024 and a total reduction of 75 basis points during the year.

LH Meyer predicts that the first reduction will be in December 2024 and a total reduction of 25 basis points will be made during the year. Morgan Stanley expects the first reduction to be made in September 2024, for a total reduction of 75 basis points during the year.

MUFG expects the first reduction to occur in July 2024 and is forecasting an aggressive reduction for a total reduction of 125 basis points throughout the year. Nomura, Oxford Economics, TD Securities and UBS expect the first reduction to be made in September 2024, with a total reduction of 50 basis points throughout the year.

RBC predicts that the first reduction will be in December 2024 and a total reduction of 25 basis points will be made during the year. Societe Generale does not expect any reductions until 2025. Wells Fargo predicts that the first reduction will be in September 2024 and a total reduction of 50 basis points will be made during the year.

*This is not investment advice.

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