HSBC doesn't expect the Federal Reserve to cut interest rates for the next two years

HSBC Securities forecasts that the Federal Reserve will keep interest rates steady at the 3.5% -3.75% range set on Wednesday for the next two years after Fed policymakers cut rates by 25 basis points in a split vote. Ryan Wang, US economist at the agency, noted in a December 10 note that Fed chairperson Jerome Powell was "open to the question of whether and when the FOMC will further cut rates next year" in his post-meeting press conference. "We believe the FOMC will maintain the target range for the federal funds rate at 3.50% -3.75% throughout 2026 and 2027, but as the economy evolves, there are important two-way risks to this outlook that need to be kept in mind as in the past."