TD Securities Shifts Forecast for Next Fed Rate Cut from June to September

Deep News
03/13

TD Securities has postponed its projection for the timing of the Federal Reserve's next interest rate cut from June to September, citing uncertainties surrounding inflation trends due to the conflict in the Middle East. Strategists, including Oscar Munoz, noted in a report to clients that the firm still anticipates the Fed will maintain current rates in March. They added that the central bank is likely to offer limited forward guidance as it awaits further assessment of the conflict's impact on inflation. TD Securities now expects a total of 50 basis points in rate reductions from the Fed this year, down from a previous forecast of 75 basis points. The firm also revised its year-end forecast for the 10-year US Treasury yield to 3.85%, suggesting that the 2-year/10-year yield curve may continue to gradually flatten.

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