Factbox-Major brokerages now expect Fed to cut rates in September By Reuters

August 6 (Reuters) – Brokerages including J.P. Morgan, Citigroup and Wells Fargo have forecast a 50 basis-point interest rate cut by the Federal Reserve in September after a surprisingly weak U.S. employment report for July.

The U.S. unemployment rate jumped to near a three-year high of 4.3% in July amid a significant slowdown in hiring, fuelling concerns that the labor market was deteriorating and potentially making the economy vulnerable to a recession.

BofA Global Research brought forward its expectation of the first cut to September from December, while other major brokerages now expect the Fed to cut rates in all the three remaining meetings of the year.

Here are the forecasts from major brokerages after the July unemployment data:

New rate cut estimates Old rate cut estimates (in

(in bps) bps)

Sept Nov Dec Sept Nov Dec

Goldman Sachs 25 25 25 25 25

BofA Global Research 25 — 25 — — 25

UBS Global Wealth 50 25 25

Management 25 25

J.P.Morgan 50 50 25 — — —

Wells Fargo 50 50 25 25 25

Nomura 25 25 25 25 25

Deutsche Bank 25 25 25 25 25 25

Morgan Stanley 25 25 25 25 25 25

Citigroup 50 50 25 25 25 25

TD Securities 25 25 25 — — —

Peel Hunt 25 25 25 25 — 25

Wells Fargo

Investment Institute 50 25 25 — — —

Barclays 25 25 25 25 25

* Wells Fargo Investment Institute is a wholly owned subsidiary of Wells Fargo Bank