JPMorgan Chase & Co. has moved up its forecast for the first Federal Reserve rate cut to September, abandoning its previous December timeline as labor market data weakens and political dynamics shift within the central bank.
The investment bank now expects a 25-basis-point reduction at the September 16-17 Federal Open Market Committee meeting, according to Reuters, followed by three additional quarter-point cuts before the Fed pauses its easing cycle.
Labor Market Cracks Drive Policy Shift
Recent employment data have strengthened the case for earlier Fed action. Initial jobless claims rose to 226,000 for the week ending August 2, exceeding the 221,000 consensus and …