Woofun AI reports that institutional consensus anticipates the Federal Reserve will maintain current interest rates, though forecasts for the subsequent policy trajectory remain sharply divided. Primary market attention is fixed on whether the upcoming statement will excise dovish bias language and how new Chair Kevin Warsh will reshape policy communication. On the hold side, Moody’s projects rates will remain unchanged through the year with a potential shift to hiking if inflation expectations rise, while Nomura Securities and JPMorgan foresee stability until 2026 or a transition to a neutral stance. Wells Fargo and BNY Mellon similarly argue that absent labor market overheating or worsening inflation, there is little impetus for action, with BNY Mellon noting a removal of 2026 cut expectations.

Conversely, proponents of future easing include Goldman Sachs, which predicts cuts in June and December 2027 after removing prior forward guidance hints, and UBS, which expects reductions in March and June 2027 despite abandoning dovish rhetoric. Citi forecasts three 25 basis point cuts in late 2024 driven by easing geopolitical tensions and labor weakness, while Deutsche Bank anticipates cuts beginning mid-2025 totaling 75 basis points by year-end 2027. In contrast, hawks like Capital Economics and Barclays see potential insurance hikes as early as December, with PGIM projecting three hikes this year followed by cuts in subsequent years.

Meanwhile, Barclays, Bank of America, ANZ, Mitsubishi UFJ, and MFS all expect a hold, with MFS highlighting that Warsh may alter communication protocols by potentially discontinuing the dot plot or reducing press conference frequency.