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Federal Reserve, important news at dawn, stock market bull 2024/11/19 07:39 Financial Business Observer from Beijing The first major bank to predict the Federal Reserve will "pause interest rate cuts" in December has emerged. Known for its expertise in analyzing the Federal Reserve's policy intentions, Nomura Securities

(Nomura) expects that the Federal Reserve will no longer cut interest rates at the December policy meeting, making it the first major bank to predict the Federal Reserve will "pause interest rate cuts" since Trump's election. If this is the case, Trump may consider replacing Powell.

Nomura forecasts: The Federal Reserve will only cut rates twice more, by 25 basis points at the meetings in March and June 2025, after which the benchmark interest rate will remain unchanged at 4.125%. It is estimated that tariffs will push up the already cooling inflation before next summer, and the Federal Reserve may pause interest rate cuts for a longer period, not cutting rates again until after June next year, until March 2026.

1. With the first major bank making a prediction, there will be a second and third, and the speculation about the Federal Reserve's interest rate cuts has just begun. However, Goldman Sachs and JPMorgan still expect the Federal Reserve to cut rates by 25 basis points in December.

2. Nomura is known for its in-depth analysis and forward-looking insights in predicting the Federal Reserve's monetary policy, especially at certain key junctures. Nomura has accurately predicted shifts in the Federal Reserve's policy direction multiple times: In 2022, it was the first to predict the Federal Reserve's aggressive rate hike path, including multiple hikes of 75 basis points. This was a relatively bold expectation in the market at the time, which later proved to be accurate. In 2020, at the beginning of the global pandemic, it successfully anticipated that the Federal Reserve would quickly implement large-scale easing measures, including cutting interest rates to near zero and launching quantitative easing (QE) measures.

3. Currently, the market believes there is a 62% probability that the Federal Reserve will cut rates by 25 basis points in December, and a 38% probability that it will pause rate cuts. If Nomura's expectations are correct, then the market is not adequately prepared for the Federal Reserve's decision to "pause interest rate cuts."

4. The truly critical moment is December 6, when the U.S. will release the November non-farm payroll data. If it is a disastrous report, then there will be a rate cut; if it is a strong report, then there will be a pause in rate cuts; if it falls in between, then await the CPI data on December 11 for the final verdict. #BabyMarvinf9c7火星狗