Fed Expected to Cut Rates Slightly in 2024, But Outlooks Differ on Pace of Cuts

The Fed funds rate is expected to decline slightly by end of 2024, but not dramatically. Markets see bigger rate cuts than the Fed.

Rate cuts are expected in the second half of 2024, potentially starting in June.

Markets see rates declining to 4-5% by end of 2024, while the Fed sees rates around 5%.

Inflation is expected to remain above 2% in 2024, driving slow pace of rate cuts.

Recession risks could lead to more aggressive rate cuts, but not the base case for now.