Deutsche Bank expects the Federal Reserve to raise interest rates by a total of 50 basis points this year, with quarter-point hikes in September and December taking the federal funds rate to 4.13% by year-end. The bank projects the U.S. economy will expand about 2.2% this year and next, supported by financial conditions, fiscal policy, productivity gains, and AI investment. It sees core PCE inflation ending the year at about 3.2% before easing to 2.5% next year, remaining above the Fed's 2% target. The labor market is expected to stay broadly stable with unemployment around 4.2% to 4.3% over the next two years. Deutsche Bank says risks are balanced, with a faster inflation slowdown or weaker labor market potentially eliminating the need for additional hikes, while persistent price pressures could require further tightening.
Deutsche Bank AktiengesellschaftDeutsche Bank's own forecast of Fed rate hikes is positive for its net interest income and reflects its research credibility.
Advanced Micro Devices Inc