(Reuters) – Major brokerages still expect a slower pace of interest-rate cuts by the U.S. Federal Reserve ahead of the personal consumption expenditures (PCE) data, the central bank’s preferred measure of inflation, due later in the day.
February’s PCE numbers are anticipated to reveal a rebound in consumer spending and a rise in annual core PCE prices to 2.7%.
Meanwhile, U.S. President Donald Trump unveiled a 25% tariff on imported cars and light trucks set to take effect on April 3, forcing further uncertainty in U.S. financial markets.
Currently, traders expect two rate cuts of 25 basis points each for the year, according to data compiled by LSEG.
Here are the forecasts from major brokerages before the inflation report:
Brokerage Total cuts in No. of cuts in 2025 Fed Funds Rate
2025
Deutsche Bank No rate cut 0 4.25-4.50% (end of
2025)
Morgan Stanley 25 bps 1 (25 bps in June) 4.00-4.25% (in 2025)
Goldman Sachs 50 bps 2 (25 bps each in 3.75-4.00% (through
June and December) December)
J.P.Morgan 50 bps 2 (25 bps each in 3.75-4.00% (through
June and September) September 2025)
Citigroup 125bp 5 (starting in May) 3.00-3.25% (end of
2025)
Barclays 50 bps 2 (25 bps each in 3.75-4.00% (through
June and September) September)
Berenberg No rate cut 0 4.25-4.50% (end of
2025)
Nomura No rate cut 0 4.25-4.50% (end of
2025)
HSBC 75 bps 3 (25 bps each in 3.50-3.75% (end of
June, September and 2025)
December)
ING 50 bps 2 (H2 2025) 3.75-4.00% (end of
2025)
75 3 (25
Wells Fargo bps bps each in June, 3.50-3.75% (end of
September and 2025)
December)
No 0
BofA Global rate cut 4.25-4.50% (end of
Research 2025)
(Compiled by the Broker Research team in Bengaluru; Editing by Anil D’Silva and Mrigank Dhaniwala)
