Allianz Chief Economist: The Federal Reserve is expected to cut interest rates once in 2025.

Jin10 Data reported on April 3 that Allianz Chief Economic Advisor Mohamed El-Erian expects the Federal Reserve to cut interest rates only once this year, which sharply contrasts with market and Federal Reserve expectations. The market has fully priced in expectations for at least two rate cuts in 2025, and a third cut is also likely. Overall, they expect a rate cut of about 70 basis points this year, with the first cut of 25 basis points in July. Meanwhile, the Federal Reserve’s latest dot plot only calls for two rate cuts. El-Erian stated that the Federal Reserve is “essentially dovish,” adding that he is concerned that the Federal Reserve is ignoring weak economic data and labeling the impending tariffs as temporary before truly understanding the details of those tariffs and how countries will respond.