Dec 8 (Reuters) – Morgan Stanley, Standard Chartered and Nomura became the latest brokerages to forecast an interest rate cut by the U.S. Federal Reserve in December, as dovish signals from key voting members and weakness in the labor market ramped up hopes of lower borrowing costs.
The brokerages joined global peers such as J.P.Morgan and Goldman Sachs who expect a quarter-point reduction at the Federal Open Market Committee meet for their last policy meeting of the year on December 9 and 10.
Traders are pricing in an 89.4% chance of a 25-basis-point interest rate cut in December, according to CME Group’s FedWatch Tool.
Here are the forecasts from major brokerages for December policy meeting:
Brokerage December policy Fed Funds Rate (end
meeting of 2025)
Citigroup 25 bps 3.50-3.75%
Wells Fargo 25 bps 3.50-3.75%
Goldman Sachs 25 bps 3.50-3.75%
J.P.Morgan 25 bps 3.50-3.75%
Barclays 25 bps 3.50-3.75%
Nomura 25 bps 3.50-3.75%
Morgan Stanley 25 bps 3.50-3.75%
Deutsche Bank 25 bps 3.50-3.75%
BofA Global 25 bps 3.50-3.75%
Research
BNP Paribas 25 bps 3.50-3.75%
HSBC 25 bps 3.50-3.75%
Standard 25 bps 3.50-3.75%
Chartered
UBS Global 25 bps 3.50-3.75%
Research
Macquarie 25 bps 3.50-3.75%
* UBS Global Research and UBS Global Wealth Management are distinct, independent divisions in UBS Group
(Compiled by the Broker Research team in Bengaluru; Editing by Krishna Chandra Eluri, Anil D’Silva and Shinjini Ganguli)
