Bank of America: Predicting that the Federal Reserve will cut interest rates twice this year.

Economists at Bank of America predict that the Federal Reserve will cut interest rates twice this year, in September and December, based on the weak job data in August. This is a departure from their previous unconventional forecast that the Fed would not take action until next year. Aditya Bhave stated in a report: "There is now clearer evidence that not only is labor supply deteriorating, but labor demand as well." This new forecast also includes three 25 basis point rate cuts starting in June 2026, which will bring the policy rate target range down from 4.25%-4.5% to 3%-3.25%.