Economists at Deutsche Bank have changed their forecast and are now expecting more rate cuts from the Fed at its next meeting. Meanwhile, the US dollar is showing off its safe-haven status.
Key quotes
“Our Fed call has changed and we now expect 100bps of cuts at the next meeting, bringing the fed funds rate directly to the zero bound.”
“They also don’t rule out an early emergency cut given the volatility. It wouldn’t surprise any of us if this happens at any moment.”
“If the Fed cuts rates to zero by this meeting as they expect, Chair Powell’s press conference should focus on the next policy steps should the outlook deteriorate further.”
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