Economists lower their expectations for US job growth by the end of 2026, fueling speculation of a rate cut by the Federal Reserve.

Economists have lowered their forecast for US job growth by the end of next year, which helps explain why the market expects the Fed to continue cutting interest rates. According to the latest monthly survey of economists, from the fourth quarter of this year to the end of 2026, the number of jobs in the US will increase by an average of 71,000 per month, down 20,000 from the previous month's forecast. The survey indicates that slowing job growth will prompt the Fed to gradually reduce borrowing costs, with a cumulative rate cut of 1 percentage point expected by next September. Luke Tilley, chief economist at Wilmington Trust Corp, said, "We still expect a weak labor market, job losses, and soft service sector consumer spending to outweigh the impact of tariffs on goods, leading to multiple rate cuts by the Fed before the end of 2025 and the beginning of 2026."