Citi predicts that the Federal Reserve will start cutting interest rates by 25 basis points at each meeting from September until July 2025.

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<p>TechFlow News, according to Jinshi Data, analysts at Citi Research predict that the Federal Reserve will begin significant rate cuts in the coming months and continue until next summer. According to the report released last Friday, Citi believes that the Fed will start cutting rates by 25 basis points at each meeting from September until July 2025, totaling eight cuts, bringing the benchmark rate from 5.25%-5.5% down to 3.25%-3.5%.</p>
<p>Citi analysts pointed out that the US economy has cooled down from its strong growth in 2023, and inflation has begun to slow down again. The ISM Services Index has entered the contraction zone, and the unemployment rate has risen to 4.1%, factors that increase the risk of a sharp decrease in economic activity and an accelerated pace of rate cuts.</p>
<p>Citi's Chief US Economist Andrew Hollenhorst stated that the continued weakness in economic activity will prompt the Fed to cut rates successively in the subsequent seven meetings. Hollenhorst also noted that a sharp economic downturn could generate enough political consensus to demand increased government spending to stimulate the economy.</p>
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Citi predicts that the Federal Reserve will start cutting interest rates from September until July 2025.