While there are only two days left for the FED's July interest rate decision, Fitch Ratings, in its latest forecasts for the US Federal Reserve's Federal Open Market Committee (FOMC), expects the FED to cut interest rates twice by the end of the year.
In its report, Fitch stated that interest rate increases in 2023 have begun to have some impact on the US labor market and demand, but politics remains an area of high uncertainty for interest rate cuts and geopolitical risk is permanent.
“In view of the continuation of the decline in inflation, we expect interest rate cuts from the FED in 2024 to be slightly slower than our previous forecast.
“Given our expectations for the end of 2023, the latest US inflation and labor market data support our view that two rate cuts are likely in the second half of 2024.”
In March, Fitch Ratings expected the FED to cut interest rates three times, for a total of 75 basis points, by the end of 2024.
*This is not investment advice.