Tianfeng Securities: There are three possible scenarios for the future interest rate cut path of the Federal Reserve. Which scenario has the highest probability?

Tianfeng Securities released a research report stating that in September's FOMC meeting, emphasis was placed on slowing job growth, leading to an adjustment in the interest rate cut expectations for 2025. Powell stated "risk management for rate cuts," adopting a dovish stance while remaining cautious. In terms of market response, the market perceived the caution behind Powell's rate cuts. The future interest rate path of the Federal Reserve summarizes three scenarios: soft landing, recession, and high inflation. The soft landing scenario is the base case with the highest probability. In this scenario, the US economy achieves a "soft landing" without experiencing a major recession or excessive inflation. It is expected that there will be two more rate cuts this year and, as next year is a midterm election year, Trump may have political demands for rate cuts. Moreover, Trump is increasing intervention in the Federal Reserve Board of Governors, leading to the expectation of three more rate cuts.