FACTBOX-Brokerages retain September rate cut bets after soft jobs report
August 4 (Reuters) - Wall Street brokerages retained their expectations for a September rate cut following a soft jobs report.
Data on Friday showed nonfarm payrolls increased by 73,000 jobs last month after rising by a downwardly revised 14,000 in June. Economists polled by Reuters forecast payrolls advancing by 110,000 jobs in July.
Macquarie changed its rate-cut call following the jobs data and expects the Fed to deliver its next interest rate cut in September as compared to their previous forecast of a 25-basis-point reduction in December.
Last month, the U.S. central bank held interest rates steady and maintained its projection for two cuts this year, though a growing minority sees no cuts at all, and slightly dialed back its outlook to just one 25-basis-point cut in both 2026 and 2027.
Traders are pricing in 58.5 bps in rate cuts by year-end, according to data compiled by LSEG. They are penciling in about a 77.7% chance of a 25-bps cut in September, according to the CME Group's FedWatch tool.
Here are the forecasts from major brokerages for 2025:
Brokerage | Total cuts in 2025 | No. of cuts in 2025 | Fed Funds Rate (end of 2025) |
Citigroup | 75 bps | 3 (starting in September) | 3.00-3.25% (March 2026) |
Wells Fargo
| 75 bps | 3 (starting in September) | 3.50-3.75% |
Goldman Sachs | 75 bps | 3 (Starting in September) | 3.50-3.75% |
Macquarie
| 25 bps | 1 (in September) | 4.00-4.25% |
J.P.Morgan | 25 bps | 1 (in December) | 4.00-4.25% |
Barclays | 25 bps | 1 (in December) | 4.00-4.25% |
Nomura | 25 bps | 1 (in December) | 4.00-4.25% |
Morgan Stanley | No rate cut | 0 | 4.25-4.50% |
Deutsche Bank | 25 bps | 1 (in December) | 4.00-4.25% |
BofA Global Research | No rate cut | 0 | 4.25-4.50% |
UBS Global Research | 100 bps | Starting in September | 3.25-3.50% |
BNP Paribas | No rate cut | 0 | 4.25-4.50% |
UBS Global Wealth Management | 100 bps (by H1 2026) | Starting in September | 3.25-3.50% (End of H1 2026) |
HSBC | 50 bps | 2 (in September and December) | 3.75-4.00% |
Related Articles
Decoding Wall Street’s Q2 2025 Playbook
TradingKey - In Q2 2025, the S&P 500 achieved an 11% increase, reaching an all-time high, signaling a robust bull market. However, this rally was highly concentrated, driven primarily by a small group of technology stocks, while other sectors experienced limited growth or declines.
Spotting Signals for the Next Crypto Bull Run: Will Bitcoin Asia 2025 Deliver?
TradingKey - Markets were caught off guard last week when Fed Chair Jerome Powell struck a surprisingly dovish tone at Jackson Hole.
CrowdStrike 2025Q2 Earnings Preview: Well-Positioned for AI Innovations
TradingKey - CrowdStrike will release its earnings for the second quarter of the fiscal 2025 on August 27th after the bell.Overall, CRWD stock has been outperforming the broad market by being up 20% since the beginning of the year, however after July it has been in a constant decline.
What to Watch in Nvidia’s Q2 FY2026 Earnings: AI Growth, Margins, and Market Impact
TradingKey - NVIDIA Corporation (NASDAQ: NVDA) will report its Q2 FY2026 earnings on Wednesday, August 27, 2025, after the U.S. market closes. The earnings call is scheduled for 5:00 p.m. Eastern Time. With Nvidia being a bellwether in AI, gaming, and data center markets, and carrying significant...
Eurozone Q2 GDP Commentary: Will the Euro's Upward Momentum Persist?
TradingKey - On 14 August 2025, Eurostat published Q2 GDP figures, revealing a drop in the Eurozone's quarter-on-quarter growth from 0.6% in the first quarter to 0.1%. Consequently, annual growth eased from 1.5% to 1.4%. The slowdown primarily stems from the diminishing boost from European...
