瑞银在FOMC会议前加入降息25个基点的阵营

UBS sits in the 25-basis point rate cut camp, as the investment bank said it anticipates that Jerome Powell and the rest of the FOMC will decide on a 25-basis point rate cut at the upcoming Wednesday FOMC meeting.

“We expect the FOMC to assume a series of 25 bp rate cuts are in train, and the median assumption of appropriate policy in 2025 is below 3.5%,” UBS stated in an investor note on Monday.

Moreover, UBS went on to add: “We do see some risk of a 50 bp rate cut, but based on the communications into the quiet period continue to expect a series of 25 bp rate cuts unless the data deteriorates more ominously.”

UBS also said that they believe Chairman Powell will likely make it clear and remind everyone that the direction of travel is clear, and that is that interest rates will be trending in a lower direction.

While the idea of a 25- or 50-basis point cut swirl in the air for this upcoming Wednesday FOMC meeting, Standard Chartered came out and argued that an FOMC rate cut of 50-basis points may perhaps be worse than cutting rates by the smaller 25-basis points.

Per the FedWatch Tool, as of Monday, the target rate probability for a 50-basis point rate cut on Wednesday hovers at 63% while a 25-basis point cut sits at 37%.

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