A survey by Bank of America ($BAC (-0,1%)) of global fund managers shows that most investors expect the FED in September 2024 will start cutting interest rates. More than half (56%) of the investors surveyed expect the first interest rate cut on September 18, and 87% assume that the first rate cut will take place in the second half of the year will take place. According to Refinitiv, the money markets are already pricing in an interest rate cut by 25 basis points in September completely in September.

These expectations are supported by data showing a slowdown in inflation and a slowdown in economic activity, suggesting that the interest rate hikes to date will not be enough. interest rate hikes of the FED have been effective. With inflation under control and a rising unemployment rate it is expected that the FED will shift its focus from fighting inflation to preventing job losses and a possible recession.

The CME FedWatch
tool shows a 100% probability of a rate cut by a quarter of a quarter percentage point in Septemberwith a small chance of 6,7% for a reduction by half a half a percentage point. Leading Fed members have also signaled that a rate cut could be justified in the coming months.