'JPMorgan Asset Says Fed Rate Cuts May Be Steeper Than Expected'

 

• Reasonable base case is 150 basis points of cuts: Mac Gorain
• JPMorgan Asset favors buying five-, seven-, 10-year Treasuries

The Federal Reserve may end up cutting interest rates more than it’s currently signaling as the US economy slows, driving a rally in shorter-maturity Treasuries, according to JPMorgan Asset Management.

“What the market’s pricing is roughly 1.5% of cuts and that’s probably a reasonable central case,” said Seamus Mac Gorain, head of global rates in London at the money manager, which oversees about $2.9 trillion. “In bad economic outcomes it could be, you know, quite a bit bigger than that.”

https://www.bloomberg.com/news/articles/2024-01-11/jpmorgan-asset-says-fed-rate-cuts-may-be-steeper-than-expected