03:11 PM EDT, 09/10/2024 (MT Newswires) -- JPMorgan Chase ( JPM ) said Tuesday that Wall Street's net interest income consensus for 2025 is too high when considering interest rate cuts that are widely expected to begin at the Federal Reserve's monetary policy meeting next week.

Chief Operating Officer Daniel Pinto said at a conference that the market is modeling for a $1.5 billion annual decline in NII to $90 billion next year, but the metric will likely be lower than that with the Fed expected to reduce benchmark rates by 250 basis points in total, according to a Capital IQ transcript.

Financial markets are pricing the federal funds rate in the range of 3% to 3.25% by the end of 2025, compared with the current 5.25% to 5.50% range, according to a Wells Fargo Investment Institute report published Monday.

Pinto didn't provide an official guidance for 2025. Shares of JPMorgan ( JPM ) fell 5.1% in afternoon trade.

JPMorgan ( JPM ) in July affirmed its 2024 guidance for net interest income of $91 billion. The consensus on Visible Alpha is for $91.33 billion in NII this year.

The central bank's Federal Open Market Committee increased its benchmark lending rate by 525 basis points between March 2022 and July 2023 in a bid to combat inflation, but has since held monetary policy steady.

The odds of the FOMC reducing rates by 25 basis points on Sept. 18 dipped to 67% on Tuesday from 70% the day earlier, according to the CME FedWatch tool. The probability of a more aggressive 50 basis-point cut edged up to 33% from 30%.

Last month, Fed Chair Jerome Powell said the "time has come" to start easing monetary policy. On Friday, New York Fed President John Williams said it is "now appropriate" to pivot to rate cuts with inflation on a path to 2%.

Government data showed Friday that the US economy added fewer jobs than the market expected in August, while the unemployment rate ticked down.

Price: 205.14, Change: -11.67, Percent Change: -5.38