Market Analysis: The Federal Reserve is expected to cut interest rates this week, but the voting results may be divided into three factions
Jinse Finance reported that the Federal Reserve is expected to lower the federal funds rate target range by 25 basis points to 3.75%–4.0% on Wednesday. However, Generali Investments anticipates a “three-way split” in policymakers’ votes: one dissenter supporting a larger 50 basis point rate cut, and possibly some dissenters favoring keeping rates unchanged. The institution’s senior economist, Paolo Zanghieri, stated that this would result in an “almost unprecedented” divergence. The institution expects the Federal Reserve to cut rates again in December and to make the final rate cut in the first quarter of 2026. Zanghieri noted that at the press conference, Federal Reserve Chair Jerome Powell may describe this rate cut as a risk management measure, without giving any indication of policy inclination for the December meeting.
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