JPM - Wall Street Banks Readjusts 2024 Interest Rate Predictions After Fed's Dovish Turn | Benzinga
Wall Street is recalibrating its 2024 interest rate forecasts following a significant dovish pivot from the Federal Reserve.
This change in stance, indicating potential rate cuts, has led to a notable shift in market dynamics, with investors and forecasters adjusting their expectations for the upcoming year.
What Happened: During the recent Federal Open Market Committee (FOMC) meeting, Jerome Powell, the Fed chairman, held interest rates steady, continuing the trend of the past three policy meetings.
Despite this, Powell's comments on potential inflation reversals and subsequent rate cuts have shifted the focus to the timing of these cuts in 2024.
As reported by Business Insider, the Fed's projections show a decrease in the expected end-of-2024 interest rates to 4.6%, down from 5.1% in September, hinting at multiple rate cuts next year.
There is a changing consensus on Wall Street, primarily driven by the Fed's tendency to lag in setting interest rate policy. This is due to officials relying heavily on delayed economic data to inform their rate decisions.
Bank of America Corp (NYSE: BAC)'s analysis after the FOMC meeting ...