ING Forecasts Fed Interest Rate Cuts Amidst Modest Growth

ING, a global financial giant, anticipates that the Federal Reserve will commence interest rate cuts in the second quarter of the upcoming year.

Chief International Economist at ING, James Knightley, highlighted key factors influencing this prediction, citing U.S. data indicating modest economic growth, cooling inflation, and a stabilizing labor market. Knightley emphasized that these trends align with the Federal Reserve’s objectives, signaling no immediate need for further policy tightening.

ING’s forecast includes anticipating 150 basis points of rate cuts in 2024, with an additional 100 basis points in early 2025. The economist underscored concerns about the labor market, noting an increase in initial jobless claims and interpreting it as evidence of a cooling but not collapsing job market. Knightley also pointed out moderating inflation pressures and cautioned about weakening outlooks due to rising credit card delinquencies and financial pressure on households.

Clever Robot News Desk 7^th December 2023