BoA/ML expect the Fed to cut in September … but risk is skewed to a cut in July

Tracking some of the expectations for the Federal Reserve FOMC.

Bank of America sees cut of by 75bp beginning in September

• But warn of a skew to risk of first cut coming in July
• and also cutting more than the market is pricing

Say if the Fed are uncertain

• the bank will adopt a risk management approach to setting monetary policy
• which means they'll try to minimize the risk of the being wrong,

Unlikely the Fed will remain on hold - a lot of things need to fall right for this

• eg - deal at the G20