Richard Drury
After Friday’s jobs report showed the unemployment rate rose by 272,000, or 4%, in May, JPMorgan Chase and Citigroup gave up their calls for a rate cut in July.
JPMorgan now expects the first rate cut – 25 basis points – to occur in November July. Citigroup now expects to raise interest rates by 75 basis points in September, rather than in July.
“Most sell-side economists and other professional Fed watchers now expect a rate cut or two in September or December this year,” Nick Timiraos, the Wall Street Journal’s chief economics correspondent, wrote on X.com.
Institutions expecting first rate cuts in December include Bank of America (25 basis points); BNPP (25 basis points); Deutsche Bank (25 basis points); LH Meyer (25 basis points); and RBC (25 basis points).
Others expecting the Fed to cut rates in September include Barclays (25 basis points); Evercore ISI (50 basis points); Goldman Sachs (50 basis points); HSBC (25 basis points); Calshe (25 basis points) (basis points); Morgan Stanley (75 basis points); Nomura (50 basis points); Oxford Economics (50 basis points); TD Securities (50 basis points); UBS (50 basis points); and Wells Fargo (50 basis points).
“Most stores expect 1 to 2 cuts in 2024,” Timiraos wrote. “If you think it’s 2, then you can do it every season starting in September. If you think it’s 1, then you can do it from 12 Starting every month and conducted every quarter.
Jefferies, Mizuho and Societe Generale expect the Fed to cut interest rates for the first time in 2025.
According to news released by Timiraos on June 3, Mitsubishi UFJ Financial Group (MUFG) is the only institution that still expects a 100 basis point interest rate cut in July.
