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Xinan Asset Management: History shows that the likelihood of the Federal Reserve cutting interest rates by 25 basis points is greater

2024-09-17 19:05:08

ChainCatcher news, according to Jinshi reports, the Chief Global Strategist of Xinan Asset Management, Sima Sha, stated in a report that while some may believe the Federal Reserve will cut rates by 50 basis points this week, history suggests that a 25 basis point cut is more likely. "Since the late 1980s… a 25 basis point cut has become the norm, while a 50 basis point cut is the exception."

She noted that only twice has the initial cut in a rate-cutting cycle exceeded 25 basis points: in January 2001 during the dot-com bubble, and in September 2007 during the subprime mortgage crisis. Both periods were marked by significant concerns over severe asset price bubbles and systemic financial risks.

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