StanChart Forecasts 50 Basis Point Fed Rate Cut Following Weak Jobs Data
Standard Chartered Bank now expects the U.S. Federal Reserve to deliver a sharper-than-anticipated interest rate cut at its upcoming policy meeting, citing signs of cooling in the labor market.
The bank projects that the Fed will lower its benchmark rate by 50 basis points, rather than the previously anticipated 25 bps, after the latest employment report revealed slower job growth and softer wage pressures.
Analysts at StanChart noted that the weaker data increases pressure on the central bank to act more decisively in order to support economic momentum and prevent a deeper slowdown. The Fed’s decision will be closely watched by investors, with markets already pricing in heightened odds of a larger rate cut.
The move, if confirmed, would mark a significant shift in monetary policy, signaling the Fed’s willingness to respond quickly to mounting evidence of a labor market downturn.
