Balanced News: UBS sees a raft of Fed rate cuts next year on the back of a U.S. recession

UBS expects the US Federal Reserve to cut interest rates by up to 275 basis points in 2024, four times the market consensus, due to an anticipated US recession. The bank’s economists predict disinflation and rising unemployment will weaken economic output in 2024, prompting the Federal Open Market Committee to cut rates. UBS expects the US economy to contract by 0.5% in mid-2024, with GDP growth dropping to 0.3% and unemployment rising to nearly 5% by the end of the year. The bank’s forecast is well below the market consensus and Goldman Sachs’ projection of 2.1% GDP growth in 2024.