Factbox-Brokerages predict September rate cut as market braces for Powell’s speech by Reuters

(Reuters) – Most brokerages forecast a 25-basis-point interest rate cut by the U.S. Federal Reserve in September, even as financial markets look for clearer clues from Chairman Jerome Powell’s Jackson Hole speech on Friday.

Powell’s speech comes after minutes of the central bank’s July meeting showed a “large majority” of policymakers agreed that policy easing was likely to begin next month.

Four of the brokerages, JP Morgan, Citigroup, UBS Global Wealth Management and Wells Fargo, expect a 50 bps rate cut at the next Fed meeting in September.

Almost all brokerages expect the Fed to cut rates at all three remaining meetings of the year, a view echoed by 55 of 101 economists polled by Reuters.

Here are the latest forecasts from major brokers ahead of Powell’s conference speech:

Rate Cut Estimates (in bps)

Sept. Nov. Dec

Goldman Sachs 25 25 25

BofA Global Research 25 — 25

UBS Global Wealth 50 25 25

management

JPMorgan 50 50 25

Wells Fargo 50 50 25

Number 25 25 25

Deutsche Bank 25 25 25

Morgan Stanley 25 25 25

Citigroup 50 50 25

TD Securities 25 25 25

Peel Hunt 25 25 25

Wells Fargo 50 25 25

Investment Institute

Barclays 25 25 25

UBS Global Research 25 25 25

* Wells Fargo Investment Institute is a wholly owned subsidiary of Wells Fargo Bank

** UBS Global Research and UBS Global Wealth Management are distinct, independent divisions of the UBS Group