UBS forecasting many more Federal Reserve rate cuts, forecast S&P 500 to 6200

UBS on the Federal Open Market Committee (FOMC) rate cut and outlook for US equities.

In summary:

• With signs that inflation is being brought under control, the Federal Reserve can now shift its focus to fostering job growth and economic expansion while managing the risk of a recession.
• UBS continue to expect 100 basis points of rate cuts in 2024.
• UBS add that the recent dot plot aligns with their forecast for the pace of monetary easing through the end of 2025.
• On stocks, UBS analysts say that historically stock markets have performed well when the Fed reduced interest rates without the economy being in a recession, and they anticipate the same outcome this time. Their outlook remains that the S&P 500 will reach 5,900 by the end of this year and rise to 6,200 by mid-2025.

This article was written by Eamonn Sheridan at www.forexlive.com.