TechFlow news, according to Jinshi, economists have shown clear divergence in their expectations for the timing of Federal Reserve rate cuts. Among 101 surveyed economists, 67 expect the Fed to cut rates by the end of June, with 22 forecasting action in March and 45 favoring the second quarter; another 17 anticipate rate cuts in the second half of the year, while 16 believe rates will remain unchanged throughout the year.
The median forecast predicts two rate cuts by year-end, bringing the target range to 3.75%-4.00%, though the projection range is extremely wide (from 3.00%-3.25% to 4.50%-4.75%). Notably, 90% of recurring respondents raised their inflation outlook for 2025, with an average upward revision of about 40 basis points.
The chief economist at Capital Economics pointed out that if the Trump administration's proposed high tariff policies are implemented, rising inflationary pressures would limit the Fed's room to cut rates this year. Current rate futures markets indicate a slightly above 50% probability of one rate cut before mid-year.
