Canadian Business Economics Association: The Federal Reserve needs to cut interest rates by more than 50 basis points next year

ChainCatcher news, according to Jinshi reports, the Federal Reserve's median forecast for the 2025 interest rate is only a 50 basis point cut, but the Bank of Canada (BCA) expects more rate cuts. BCA analysts stated in a report that inflation is likely to be lower than the Federal Reserve's 2025 forecast, while the unemployment rate may be higher than the Federal Reserve's 2025 forecast.

They stated, "Therefore, a loosening policy of more than 50 basis points will be needed." The Federal Reserve predicts an unemployment rate of 4.3% by the end of 2025, "which requires a significant improvement in the momentum of the labor market, and we believe that such a trend reversal is unlikely to occur."