IMF Says US Fed Has Little Scope for Rate Cuts This Year

While US inflation is on course to return to the Federal Reserve’s 2% target in the first half of 2027, policymakers have little room to cut interest rates this year, according to the International Monetary Fund.

IMF staff expect a single rate reduction by the end of 2026, according to the Washington-based lender’s annual review of US economy, known as an Article IV consultation. “On balance, staff see little scope to lower the policy rate over the coming year.”