ABN AMRO forecasts the Fed will delay easing until December, then cut rates by 25 bps quarterly to 2.75–3.00% by June 2025.
The Federal Reserve is expected to maintain its current rate range of 3.50–3.75% until December as it assesses persistent inflation driven by oil shocks and tariff-related goods inflation. The delay reflects concerns over second-round inflation effects before any policy shift.
Prior expectations had anticipated earlier easing, but elevated headline and core inflation have pushed back projections. The Fed signaled no consensus for cuts until goods inflation moderates, aligning with a higher-for-longer stance.
ABN AMRO projects quarterly 25 bps reductions starting in December, lowering rates to 2.75–3.00% by June 2025. This gradual approach aims to balance inflation risks while avoiding abrupt policy shifts.