Galaxy Securities: The US still has about three rate cuts room in 2026

On December 25, according to Jin10 Data, Galaxy Securities pointed out that due to the impact of economic growth exceeding expectations, CME observation data shows that the probability of rate cuts in January 2026 has converged with previous levels. After the data was released, Fed Chair candidate Harker stated that the growth foundation still comes from falling prices, income growth, and improved sentiment, and explicitly pointed out that if GDP growth remains around 4%, new employment is expected to return to the range of 100,000 to 150,000 jobs per month. He also frankly said that the Federal Reserve is clearly lagging behind the situation on rate cuts.
We believe that the economic growth in the third quarter mainly reflects the fading of inventory and trade disturbances and is not enough to change the marginal weakening trend of employment; against the background of employment becoming the policy focus and the gradual implementation of Fed Chair candidates, there still remains about three rate cuts room in 2026.