The Federal Reserve (Fed) will hold interest rates steady at 2.25-2.50% this year and not cut rates until the third quarter next year, according to the latest Reuters poll of 100 economists conducted in six days to June 12.
While the latest consensus points to rates on hold this year, the probability of a Fed rate cut has significantly increased in over the past four weeks.
For instance, 40 of 100 common contributors expect the Fed to cut rates by 25 basis points sometime this year compared to just eight respondents in the previous poll.
It is worth noting that the Fed funds futures market is already pricing in an 80% chance of a rate cut by July. Even so, most analysts expect the US Dollar to remain bid for the rest of this year.
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