📖 Your Q2 Earnings Guide: Discover the Stocks ProPicks AI Highlights to Jump Post-EarningsRead more

Survey shows Fed expected to cut twice in 2024

Published 06/24/2024, 09:53 AM
© Reuters

A Strategas survey reveals a shift in its clients' expectations regarding Federal Reserve policy.

While still anticipating two rate cuts in 2024, investors now look towards November and December rather than September, according to the firm's latest note. This aligns with Strategas' own forecast of two cuts this year, but they predict an earlier start in September.

The firm also highlights a potential dovish tilt in long-term views. Strategas reports a reversal in the rise of long-term rate expectations observed earlier in 2024, with investors lowering expectations by 25 basis points over the next 36 months.

This suggests that long-term yields could fall further than previously anticipated. However, Strategas cautions that further evidence of disinflation is needed before long-term expectations adjust more decisively.

The survey findings show investors expecting two rate cuts by year-end, without a September move, implying cuts at the November and December meetings.

There's increased uncertainty about the near-term path of rate cuts, but this is balanced by a more optimistic outlook on future inflation. Strategas said its clients are more hawkish than futures markets, which are currently pricing in three cuts by the end of 2024.

Overall, the Strategas survey suggests a cautious optimism among investors regarding the Fed's future actions. They anticipate two rate cuts this year, but with the timing potentially pushed back to the later months.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.