The firm previously saw no rate cut by the Fed for December but now revises that call to a 25 bps rate cut for next week. Adding to that, they also see another 25 bps rate cut in April 2026. And that will take the Fed funds rate to their terminal target range of 3.00% to 3.25%.
As things stand, traders are pricing in ~86% odds of a 25 bps rate cut by the Fed for December currently. And by April next year, there is roughly 44 bps worth of rate cuts priced in at the moment.
