Deutsche Bank: The Federal Reserve will not cut interest rates next year

ChainCatcher news, Deutsche Bank released a report on this week's FOMC meeting, stating that the Federal Reserve meeting reinforced our fundamental view that the skip (rate cut) in January may turn into an extended pause (rate cut) in 2025. We continue to believe that the nominal neutral rate is around 3.75%, and the committee needs to maintain a restrictive stance relative to that level. Therefore, we reiterate our view that the federal funds rate may remain above 4% next year, with the baseline being no further rate cuts. The report also noted that some Federal Reserve participants have begun to incorporate the potential economic impact of President-elect Trump's policies into their forecasts, which could lead to higher inflation projections for 2025 and 2026. Regarding the labor market, Powell described it as solid but pointed out that the current level of job creation is below what is needed to maintain a stable unemployment rate. (Jin Shi)