Société Générale: The likelihood of the Federal Reserve cutting interest rates by 50 basis points in September is low

ChainCatcher message, Kit Juckes, Chief Global FX Strategist at Société Générale, stated in a report that the currency market's current expectations for a rate cut in the U.S. in 2024 seem a bit excessive, and the likelihood of a larger cut of 50 basis points in September remains low.

Data from Refinitiv shows that the U.S. money market currently expects a rate cut of 103 basis points in 2024, implying that the Federal Reserve will cut rates by at least 50 basis points at least once in the remaining three meetings this year. Juckes stated, "Unless the economy slows significantly, the front end of the yield curve has already priced in too much of a rate cut over the next six months." He mentioned that there is a great deal of uncertainty regarding the extent of the economic slowdown. (Jin Shi)