Institution: The Federal Reserve is expected to cut interest rates only twice next year.
Jinse Finance reported that Christian Lenk, an analyst at DZ Bank, stated in a report that the Federal Reserve is expected to cut interest rates by 25 basis points in December, after which it will take a more cautious approach. He predicts that the Fed will only cut rates two more times next year, in March and June, each by 25 basis points. DZ Bank expects that despite the Fed's rate cuts, rising inflation will continue to push up the yield on 10-year US Treasury bonds. Due to temporary tariff effects and a large government deficit, US inflation is expected to rise in the coming quarters. The long end of the yield curve may rise further, but ultimately yields will not deviate far from current levels. The 10-year US Treasury yield is expected to rise to 4.50% within the next three months (currently at 4.103%), and to 4.60% within six months.
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