Jan 23
US: New Fed forecast
Overview: Yesterday’s inter-meeting cut by 75bp, see our `FOMC: Aggressive cut by 75bp to 3.5%´ note, signals that the FOMC is extremely worried about the current situation. To us, the event illustrates that the preferences of the FOMC imply an even stronger commitment to insure against adverse economic scenarios. On this background, we have revised our Fed call. The new forecast implies that the Fed funds target is reduced to 2% by the 25 June meeting. Details: The FOMC’s decision yesterday