JPMorgan Chase (JPM), the largest U.S. bank, has reiterated its forecast for a 50-basis point interest rate cut from the Federal Reserve at its meeting on Sept. 18.
JPMorgan’s forecast is aggressive and runs counter to the consensus view on Wall Street. Futures traders are currently betting 65% that the U.S. central bank will lower interest rates by 25 basis points at its next policy meeting. However, The Wall Street Journal newspaper is reporting that policymakers at the Federal Reserve remain undecided on the size of the upcoming interest rate cut, meaning that a larger 50-basis point cut may not be off the table.
JPMorgan Doubles Down
In a note to clients, JPMorgan Chief Economist Michael Feroli wrote: “We’re sticking with our call that they (the Fed) will do the ‘right’ thing and cut 50bp.” Feroli had doubled down on his 50-basis point call over the past week after an August nonfarm payroll labor report…
