UBS Predicts 75-100 Basis Point Rate Cuts by Fed in 2025

UBS has forecasted that the Federal Reserve will reduce interest rates by 75 to 100 basis points for the remainder of 2025. This projection is part of the bank's base case scenario, which anticipates a significant reduction in interest rates to stimulate economic growth. The expectation of rate cuts comes amidst a backdrop of economic uncertainty and potential impacts from newly announced tariffs. UBS's projection suggests that the Federal Reserve may take aggressive measures to support the economy, which could have wide-ranging implications for financial markets and economic activity. The bank's analysis indicates that the U.S. economy is expected to grow at a rate closer to or below 1%, further justifying the need for monetary policy adjustments. This outlook underscores the importance of monitoring economic indicators and policy decisions as the year progresses.

UBS's forecast of rate cuts by the Federal Reserve is a response to the current economic climate, which is characterized by uncertainty and potential disruptions from tariffs. The bank's base case scenario reflects a cautious approach to economic growth, with a projected growth rate of around 1% or less. This slow growth rate, combined with the potential impacts of tariffs, suggests that the Federal Reserve may need to take aggressive measures to support the economy. The projected rate cuts of 75 to 100 basis points are a significant reduction in interest rates, which could have wide-ranging implications for financial markets and economic activity. The bank's analysis indicates that the U.S. economy is expected to grow at a rate closer to or below 1%, further justifying the need for monetary policy adjustments. This outlook underscores the importance of monitoring economic indicators and policy decisions as the year progresses.

UBS's projection of rate cuts by the Federal Reserve is a response to the current economic climate, which is characterized by uncertainty and potential disruptions from tariffs. The bank's base case scenario reflects a cautious approach to economic growth, with a projected growth rate of around 1% or less. This slow growth rate, combined with the potential impacts of tariffs, suggests that the Federal Reserve may need to take aggressive measures to support the economy. The projected rate cuts of 75 to 100 basis points are a significant reduction in interest rates, which could have wide-ranging implications for financial markets and economic activity. The bank's analysis indicates that the U.S. economy is expected to grow at a rate closer to or below 1%, further justifying the need for monetary policy adjustments. This outlook underscores the importance of monitoring economic indicators and policy decisions as the year progresses.