Group 1 - Morgan Stanley and Deutsche Bank anticipate the U.S. Federal Reserve will implement interest rate cuts at all three remaining meetings in 2023, with a 25 basis points cut expected in September, October, and December [1][2] - The Fed is expected to initiate a new easing cycle in the upcoming policy meeting, marking its first rate cut since December 2024, due to signs of a slowdown in the job market [2][3] - Traders are pricing in a 95% probability of a 25 basis points rate cut next week, with only a 5% chance of a more significant 50 basis points cut [4] Group 2 - Deutsche Bank forecasts four consecutive 25 basis points rate cuts starting next week and extending through January 2026, with additional cuts anticipated in April and July 2026 [3] - Morgan Stanley suggests that current market conditions allow the Fed to move more swiftly towards a neutral policy stance [2][3] - Standard Chartered is the only brokerage predicting a 50 basis points rate cut this month, contrasting with the broader market consensus [4]
Morgan Stanley, Deutsche Bank expect three US interest rate cuts this year