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UBS revise their US GDP forecast sharply........>

FED
FED: UBS revise their US GDP forecast sharply lower, with H1 2020 on edge of
recession.
- Tariffs have taken a heavy toll and the latest escalation is substantial
- Production and hiring are hurt, so consumption and investment falls
- Now sees Fed funds rate down to 1% next year
- UBS now expect another 25bps in September and think the FOMC will need to see
deterioration in the data before making further moves. If UBS' forecast are
borne out, they will get that signal in Q1, likely leading them to ease again in
March. As the data continue to deteriorate, UBS see the Fed taking the funds
rate down to 1 percent by Q3 next year. Given the sharp slowing, a 50bp move is
clearly possible.

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