UBS: The Fed may still cut interest rates by another 50 basis points this year

UBS believes that the Federal Reserve may still cut interest rates by another 50 basis points this year. The increase in non-farm payrolls in December last year announced by the United States last week was much higher than expected. The market generally expects that the Federal Reserve will not cut interest rates again before June this year, and the number of interest rate cuts of 25 basis points throughout the year may also be less than twice. The UBS strategy team led by Mark Haefele agrees that the latest employment data may make Federal Reserve officials pay more attention to the inflation in the United States, which may not fall back to the target of 2%. Therefore, it will not rush to cut interest rates. However, UBS still believes that the growth of the US economy will continue to slow down, and eventually orderly inflation will decline, approaching 2%. At that time, the Federal Reserve will cut interest rates twice, each by 25 basis points. (Jinshi)