Generali economists: The market has overestimated expectations of further Fed easing; another rate cut in January next year would be reasonable.

According to Odaily Planet Daily, Paolo Zanghieri, senior economist at Generali Investments, and his team believe the market has already priced in a larger rate cut than the Federal Reserve is likely to implement. "We see a 50% chance of a rate cut next month. Given the limited new data, it's reasonable for the Fed to wait until January to cut rates, while simultaneously signaling a dovish bias. More importantly, the market's expectation of nearly four rate cuts next year, based on hopes for a rapid decline in inflation, seems overly optimistic. We anticipate only a 50 basis point cut by summer." (Jinshi)