Global brokerages remain divided on whether the U.S. Federal Reserve will reduce interest rates at its upcoming December policy meeting, as mixed signals on employment and economic growth have clouded the outlook.
J.P. Morgan joined major firms including Goldman Sachs and Citigroup in expecting a quarter-point rate cut, following comments from policymakers hinting at a potential easing of borrowing costs. On the other hand, Standard Chartered and Morgan Stanley withdrew their expectations of a rate reduction after the latest U.S. jobs report, which showed resilient employment growth.
The Federal Open Market Committee (FOMC) is scheduled to meet in Washington on December 9–10 for the last policy review of the year.
Broker Forecasts for December Fed Meeting
| Brokerage | Expected Action | Fed Funds Rate (End of 2025) |
|---|---|---|
| Citigroup | 25 bps cut | 3.50–3.75% |
| Wells Fargo | 25 bps cut | 3.50–3.75% |
| Goldman Sachs | 25 bps cut | 3.50–3.75% |
| J.P. Morgan | 25 bps cut | 3.50–3.75% |
| Barclays | 25 bps cut | 3.50–3.75% |
| Nomura | No cut | 3.75–4.00% |
| Morgan Stanley | No cut | 3.75–4.00% |
| Deutsche Bank | 25 bps cut | 3.50–3.75% |
| BofA Global Research | No cut | 3.75–4.00% |
| BNP Paribas | 25 bps cut | 3.50–3.75% |
| HSBC | 25 bps cut | 3.50–3.75% |
| Standard Chartered | No cut | 3.75–4.00% |
| Macquarie | No cut | 3.75–4.00% |
| UBS Global Research | 25 bps cut | 3.50–3.75% |
Note: UBS Global Research and UBS Global Wealth Management are separate, independent divisions within UBS Group.
Market Implications
The mixed forecasts highlight uncertainty over the Fed’s next move. While some analysts view a small rate cut as likely to support economic growth, others argue that strong employment data reduces the need for immediate easing. Investors will closely monitor the FOMC meeting for signals on monetary policy direction heading into 2026.