Analysis: The Federal Reserve (FED) may effectively cut interest rates next year, with a slight decrease in the interest rate expected by the end of the year.

On July 8, Brendan Murphy, Head of Fixed Income at Insight Investment, pointed out in a report that U.S. interest rates may decline slightly before the end of this year, but substantial rate cuts will occur next year. Although the economic outlook is weakening, recent inflationary pressures from U.S. trade tariffs will complicate the Federal Reserve's policy response. Against this backdrop, the Federal Reserve is expected to adopt a cautious approach. The agency anticipates that after inflationary pressures ease and growth concerns become dominant in 2026, the Federal Reserve will implement more decisive rate cuts. (Jin10)