Given recent weak macro data, rising uncertainty and reprising of Fed, we now expect rate cuts in October and December. We still see a total of four cuts in this easing cycle, with risk tilted towards more cuts. The US economy is set to slow further. At the September meeting, the FOMC was deeply divided. Three members dissented and the dot plot showed no clear path forward, suggesting that the Fed might take a wait-and-see approach in October. Fed chair Powell’s main message from the press conference was, however, also that “they make decisions meetings by meetings”. In other words, the fate of the October meeting ... (full story)