Wells Fargo economists expect Fed to cut interest rates dramatically in 2024

CHARLOTTE — It isn’t often that an economics presentation sparks a double take. But that was the case this week when economists with Wells Fargo & Co. held their commercial real estate outlook seminar online, kicking off the Q&A with a question regarding expectations for rates next year.

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The surprising answer: They’re anticipating big rate cuts. That would be welcome news to real estate investors and others feeling the sting of the Federal Reserve’s aggressive rate hikes.

Wells Fargo’s economics team expects rate cuts in 2024 totaling 2.25 percentage points in the federal funds rate, or the rate at which banks borrow and lend their excess reserves to each other overnight. The federal funds rate currently ranges between 5.25% and 5.5%.

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