Citigroup Delays Fed Rate Cut Expectations to September

Citigroup has officially adjusted its outlook for Federal Reserve monetary policy, pushing back its timeline for interest rate reductions. The financial institution now expects the central bank to implement three separate 25-basis-point cuts throughout the remainder of the year. Under this revised schedule, the reductions are projected to occur in September, October, and December.

This shift in strategy marks a significant departure from the firm's previous forecast, which had anticipated the start of an easing cycle beginning in June. Citigroup analysts pointed to a recent string of stronger-than-anticipated U.S. labor market data as the primary catalyst for the adjustment. Furthermore, persistent concerns regarding the trajectory of inflation have prompted the bank to adopt a more cautious stance on when the Federal Reserve will begin cooling its current interest rate environment.