FED Balance Sheet Shrinks Amid Rate Cut Predictions

The Fed balance sheet shrank by $28.6 billion in one week.

JPMorgan:

• We expect the first Fed rate cut in November.

Bank of America:

• We think the Federal Reserve Board will start cutting rates in September. (Predicting two rate cuts this year)

Reuters Survey:

• The Federal Reserve Board will start cutting rates in September—analysts expect two 25 basis point cuts this year.
• The dollar will weaken, but Fed monetary policy easing is necessary.

Kashkari, Fed Chair:

• The Federal Reserve Board rate should remain unchanged for a long time.

10x Research Analysts:

• We forecast a BTC rally to $83,000 in the coming weeks, thanks to global central banks easing monetary policies (Bank of Canada, ECB, etc. lowering interest rates).
• Considering economic growth, employment, and reduced consumer spending in the US, lowering inflation is only a matter of time.

Market Expectations (Fed Rate):

• June 12: Pause.
• July 31: Pause.
• September 18: Pause.
• November 7: 25 basis point cut to 5.00-5.25%.
• December 18: Pause.
  

Earlier: Nonfarm Payrolls

US Macroeconomic Data:

• Unemployment Rate (May)
• ACTUAL: 4.0% FORECAST: 3.9% PREV: 3.9%
  
• Change in Non-Farm Employment (May)
• ACTUAL: 272K FORECAST: 182K PREV: 165K
  
• Average Hourly Earnings (YoY) (May)
• ACTUAL: 4.1% FORECAST: 3.9% PREV: 4.0%
  
• Average Hourly Earnings (MoM) (May)
• ACTUAL: 0.4% FORECAST: 0.3% PREV: 0.2%