FACTBOX-Brokerages still expect slower pace of Fed rate cuts after payrolls data
Updates with brokerage forecasts after NFP data
Feb 10 (Reuters) - Most brokerages still expect a slower pace of interest-rate cuts from the U.S. Federal Reserve in 2025, following tepid jobs data on Friday and ongoing uncertainty around President Donald Trump's tariff policy.
U.S. job growth slowed more than expected in January after two months of strong gains, but an unemployment rate of 4% will likely allow the Fed to hold off cutting rates at least until June.
On the other hand, President Trump's tariff policy is expected to drive up inflation and increase pressure on the U.S. central bank as it looks to control persistently high prices.
The Fed left its benchmark overnight interest rate in the 4.25%-4.50% range in its January policy meeting and Chair Jerome Powell said there would be no rush to cut them again until inflation and jobs data made it appropriate.
Here are the forecasts from brokerages after Friday's non-farm payrolls (NFP) data:
| Rate cut estimates (in bps) | ||||
Brokerages | Mar 2025 | 2025 | No. of cuts in 2025 | Fed Funds Rate | |
BofA Global Research | No rate cut | No rate cut | 0 | 4.25-4.50%(end of December) | |
Barclays | No rate cut | 25 (in June) | 1 | 4.00-4.25% (end of 2025) | |
BNP Paribas | No rate cut | No rate cut | 0 | 4.25-4.50%(end of December) | |
Goldman Sachs | No rate cut | 50 (June and December) | 2 | 3.75-4.00% (through December) | |
J.P.Morgan | No rate cut | 50(June and September) | - | 3.75-4.00% (through September 2025) | |
Morgan Stanley | No rate cut | 25 (in June) | 1 | 4.00-4.25% (in 2025) | |
Deutsche Bank | No rate cut | No rate cut | 0 | 4.25-4.50% (end of 2025) | |
ING | No rate cut | 50 (H2 2025) | 2 | 3.75-4.00% (end of 2025) | |
UBS Global Wealth Management | No rate cut | 50 | - | 3.75-4.00% (end of 2025) | |
Citigroup | No rate cut | 125 (starting in May) | 5 | 3.00-3.25% (end of 2025) | |
Macquarie | No rate cut | 25 | 1 | 4.00-4.25% | |
Berenberg | No rate cut | No rate cut | 0 | 4.25-4.50% (end of 2025) | |
Wells Fargo | No rate cut | 50 (September and December) | 2 | 3.75-4.00% (end of 2025) | |
Nomura | No rate cut | No rate cut | 0 | - | |
HSBC | No rate cut | 75 (starting in June) | 3 | 3.50%-3.75% (end of 2025) | |
Here are the forecasts from major brokerages before NFP data:
Rate cut estimates (in bps) | |||||
Brokerages | Mar 2025 | 2025 | No. of cuts in 2025 | Fed Funds Rate | |
BofA Global Research | No rate cut | No rate cut | 0 | 4.25-4.50%(end of December) | |
Barclays | No rate cut | 25 (in June) | 1 | 4.00-4.25% (end of 2025) | |
BNP Paribas | No rate cut | No rate cut | 0 | 4.25-4.50%(end of December) | |
Goldman Sachs | No rate cut | 50 (June and December) | 2 | 3.75-4.00% (through December) | |
J.P.Morgan | No rate cut | 50(June and September) | - | 3.75-4.00% (through September 2025) | |
Morgan Stanley | No rate cut | 25 (in June) | 1 | 4.00-4.25% (in 2025) | |
Deutsche Bank | No rate cut | No rate cut | 0 | 4.25-4.50% (end of 2025) | |
ING | No rate cut | 50 (H2 2025) | 2 | 3.75-4.00% (end of 2025) | |
UBS Global Wealth Management | No rate cut | 50 | - | 3.75-4.00% (end of 2025) | |
Citigroup | No rate cut | 125 (starting in May) | 5 | 3.00-3.25% (end of 2025) | |
Macquarie | No rate cut | 25 | 1 | 4.00-4.25% | |
Berenberg | No rate cut | No rate cut | 0 | 4.25-4.50% (end of 2025) | |
Wells Fargo | No rate cut | 50 (September and December) | 2 | 3.75-4.00% (end of 2025) | |
Nomura | No rate cut | No rate cut | 0 | - | |
HSBC | No rate cut | 75 (starting in June) | 3 | 3.50%-3.75% (end of 2025) | |
* UBS Global Research and UBS Global Wealth Management are distinct, independent divisions in UBS Group
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