FaYe Credit currently predicts that the Federal Reserve will cut interest rates twice this year, with the terminal rate being 4%.

The French Agricultural Credit Bank currently expects the Federal Reserve to cut interest rates twice this year, once in September and once in December. However, unlike other institutions, they anticipate that the final rate will be much higher, with a target rate of 4.00%. The bank believes that sticky inflation will limit the Fed's ability to adopt aggressive easing policies, despite the slowing of the U.S. economy without falling into a recession. Tariff pass-through will lead to another acceleration in inflation, although it may be temporary. Despite recent deteriorating data, the labor market remains relatively healthy, giving the Fed more room to resist calls for a more aggressive easing cycle.