The Federal Reserve’s recent moves and Bank of America’s cautious outlook for 2025 have created an interesting setup for investors who rely on dividends. After cutting rates three times in 2024, the Fed may take a more conservative approach in the new year.
While many expected more aggressive rate cuts, the Bank of America now predicts rates will stay high through 2025. This shift is driven by stubborn inflation and a surprisingly strong job market, with 256,000 jobs added in December and unemployment dropping to 4.1%, prompting BofA economist Stephen Juneau to rule out any rate cuts.
