State Street Sees Half-Point Fed Rate Cut as Soon as June
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State Street Global Advisors predicts that the Federal Reserve will cut interest rates by 50 basis points as soon as June, ahead of the US presidential election in November. The firm expects a total reduction of 150 basis points by the end of the year. State Street maintains that the US economy is not as strong as it seems, citing indicators like credit card delinquencies and the cost of credit to small businesses. The firm believes that the market is underestimating the likelihood of deeper rate cuts and sees the US election as a driver for larger rate cuts than expected. State Street continues to be overweight US stocks and long-duration sovereign bonds, with a preference for Treasuries. The firm has also increased its allocation to gold as a diversification strategy. The article was generated from an automated news agency feed without modifications to text.