FXStreet: 13 institutions look ahead to the Fed's interest rate decision tonight

The Federal Reserve will announce its latest interest rate decision at 2 a.m. Beijing time on Thursday, August 1st. While the market generally expects the Fed to stay put this month, the statement will acknowledge "greater" progress in fighting inflation and hint at an imminent rate cut through wording adjustments. Several institutions have provided insights into this FOMC meeting, including IG Group, Bank of America, Ernst & Young, Goldman Sachs, and others. It is expected that the Fed will keep rates unchanged this time, but a rate cut may come in September. Factors such as rising unemployment, falling inflation, and economic growth will influence future rate cut decisions

The Federal Reserve will announce the latest interest rate decision at 2 a.m. on Thursday, August 1st Beijing time. The market generally expects rates to remain unchanged this month, but the statement will acknowledge "greater" progress in combating inflation and suggest that rate cuts will begin soon.

Here are the outlooks for this month's FOMC meeting from 13 investment banks:

IG Group: Expects rates to remain unchanged, first rate cut in September, with over 50BP cuts by the end of the year; Powell will avoid commitments, be more optimistic about inflation, and emphasize that current risks are two-sided.
Bank of America: Expects rates to remain unchanged, the statement will indicate progress in lowering inflation; Powell will indicate that attention to the dual mandate can become more balanced.
EY Group: Expects rates to remain unchanged, the third paragraph of the statement may be modified to "Once there is greater confidence in inflation falling to 2%, the interest rate target range should be lowered."
Goldman Sachs: Expects rates to remain unchanged, the statement will emphasize rising unemployment, the Fed's more balanced focus on the dual mandate, and acknowledge greater progress in lowering inflation.
UBS Group: Expects rates to remain unchanged, 25BP rate cut in September; the steady rise in unemployment is consistent with below-trend economic growth, but the U.S. economy can still achieve a soft landing.
ING International: Expects rates to remain unchanged, first rate cut in September; Powell may maintain a hawkish stance; it is worth noting that the 4.1% unemployment rate is already higher than the Fed's forecast.
DBS Bank: Expects rates to remain unchanged; the statement may be fine-tuned, attention should be paid to the description of progress in combating inflation in the first paragraph and whether the third paragraph indicates greater confidence in inflation falling to 2%.
Deutsche Bank: Expects rates to remain unchanged; the Fed will cut rates three times by the end of the year, then pause rate cuts until September next year, with the last two rate cuts in December next year and March 2026.
Morgan Stanley: Expects rates to remain unchanged, opening the door for a rate cut in September; the statement will acknowledge significant progress in lowering inflation, with rising risks in the job market; Powell will not commit to a significant rate cut.
Fed Whisperer: Expects rates to remain unchanged, the statement will acknowledge recent improvements in inflation and a more balanced risk outlook, hinting at a higher likelihood of a rate cut in September, laying the groundwork for Powell's press conference.
Montreal Bank: Expects rates to remain unchanged, there are still questions about how much effective information Powell will provide, but the Fed still has the meeting minutes and the Jackson Hole Symposium as opportunities to signal to the market