On September 16, a report from Deutsche Bank’s market strategist Jim Reid highlighted that the magnitude of the Fed’s initial rate cut will significantly influence the total rate cut anticipated this year. Should the Fed opt for a 25 basis point reduction on Wednesday, Deutsche Bank projects an aggregate cut of 75 basis points for the year. Conversely, a 50 basis point reduction by the Fed would likely culminate in a complete 100 basis point reduction by year-end.
Refinitiv data reveals ongoing uncertainty concerning the exact extent of the Fed’s interest rate adjustment this week. Money market predictions reflect a 59% probability of a 50 basis point cut, contrasted with a 41% chance of a 25 basis point reduction. Financial analysts continue to monitor these developments closely.