Citi: "Five Rate Cuts Coming in 2025." Fed: "Lol, No."

In April 2025, when the labor market was showing some weakness, Citi made a bold prediction: the Fed would cut rates FIVE TIMES that year. The premise? A softer job market would force Powell's hand. Fast forward to June 2026: the Fed cut rates exactly THREE times in 2025 (and stopped cutting immediately after December). Then they hit pause. No cuts for six months straight. The inflated tariffs, wage pressures, and sticky inflation that Citi didn't account for sent the Fed into full hold mode by early 2026. Turns out Jerome Powell wasn't reading the same memo Citi's analysts were. The cash pile that Wall Street expected to deploy in 2025 mostly stayed put, and investors who built portfolios around five cuts got a lesson in Fed communication. Spoiler: sometimes the Fed is wrong too, and that trickles down to everyone.