UBS predicts: The Fed may cut interest rates by 75 basis points in Q1 2026, with the labor market being a key consideration for policy.

On September 18, Jinshi Data reported that Hu Yifan, UBS Wealth Management's Chief Investment Officer for Greater China and Head of Macroeconomics for Asia-Pacific, recently provided an outlook on the future direction of the Fed's monetary policy.

In the baseline scenario, Hu Yifan believes that the Fed is expected to further cut interest rates by 75 basis points by the first quarter of 2026. He pointed out that the Fed may continue to prioritize the weak conditions of the labor market over the temporary rise in inflation.

In the scenario of a downturn, if the weakness in the labor market is confirmed to be more severe and persistent, the Fed may cut interest rates by 200-300 basis points, bringing rates down to the range of 1.0-1.5%.

This forecast provides important reference for the market's assessment of the Fed's monetary policy path, and subsequent changes in the labor market and inflation data may become key variables influencing the policy direction. #美联储降息25个基点