Federal Reserve's 2025 Interest Rate Forecast May Reverse in December

According to BlockBeats, on December 19, Forexlive analyst Adam Button discussed the Federal Reserve's economic projections for 2025. The median interest rate forecast for 2025 was adjusted to 3.4% in September, down from the 4.1% predicted in June. However, Button suggests that this forecast might see a reversal to some extent in December. The federal funds futures market anticipates an interest rate of 3.84% by the end of 2025, aligning with expectations for two rate cuts next year. One of these cuts could occur during the March meeting, with the second potentially happening in either July or September. Button notes that it would not be surprising if the Federal Reserve's median rate forecast remains unchanged or increases to align with market pricing. However, if the dot plot indicates only one further rate cut, it could lead to market volatility as a hawkish surprise.