“Based on the dot plot, the median projected path for Fed Funds Rate is 4.6% by end-2024 (previous: 5.1%) and 3.6% by end-2025 (previous: 3.9%), indicating rate cuts of 75 basis points (bps) in 2024 and 100 bps in 2025. The dovish bias can be seen from the downward shift in the dot plot by 50 bps in 2024 and 30 bps in 2025,” writes Koh in his Jan 2 report.
UOB Kay Hian analyst Jonathan Koh has downgraded the Singapore banking sector to “market weight” amid an upcoming interest rate downcycle.
The US Federal Reserve has paused its rate hike for the third straight Federal Open Market Committee (FOMC) meeting on Dec 13 and it is expected to commence rate cuts in 2H2024.
