OECD Projects US Fed Rate Cuts in 2025 and Early 2026

S&P forecasts two 25-basis-point interest rate cuts by the U.S. Federal Reserve before the end of 2025, followed by a 50-basis-point reduction in 2026.

Summary

S&P projects that the U.S. Federal Reserve will implement two 25-basis-point interest rate cuts before the end of 2025, followed by an additional 50-basis-point cut in 2026. This reflects expectations of a shift toward easier monetary policy in the coming years.

Terms & Concepts
  • Basis Point: A unit of measurement equal to 1/100th of a percentage point, commonly used in finance to describe changes in interest rates.
  • Federal Reserve: The central bank of the United States responsible for implementing monetary policy, including setting key interest rates.