Deutsche Bank base case is now for a higher Fed terminal rate than previously expectedSnippet from
Deutsche Bank, in brief:
- base case for 2025 is stronger US growth and inflation
- higher FOMC terminal rate than previously expected
- opposite
applies to Europe
On the US DB:
- assumes modest US
tax cuts - strong deregulation efforts
- more supportive
financial conditions - assume a 10%
increase in the tariff rate on imports from China in H1 (ratcheting
up a further 10pp in H2) - equalisation of tariff rates on motor
vehicles with Europe
assume a 5% universal baseline tariff (more likely
to be implemented late 2025/early 2026)
This article was written by Eamonn Sheridan at www.forexlive.com.
Source: Deutsche Bank base case is now for a higher Fed terminal rate than previously expected (https://www.forexlive.com/centralbank/deutsche-bank-base-case-is-now-for-a-higher-fed-terminal-rate-than-previously-expected-20241126/)
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