Given the significant uncertainty surrounding the Federal Reserve’s actions at its meeting this week, respondents to CNBC’s Fed survey are forecasting a slower rate-cutting approach than currently priced in by markets.

The survey shows that 84 percent of the 27 respondents, including economists, fund managers and strategists, expect the Fed to cut interest rates by a quarter of a percentage point, while 16 percent expect a cut of half a percentage point. By comparison, in the Fed futures markets, a cut of half a percentage point is already priced in with a probability of 65 percent.

The differences are getting bigger over time: survey participants are forecasting year-end interest rates of 4.6% and 3.7% by the end of 2025, compared to 4.1% and 2.8% on the futures market.

“We believe the equivalent of eight cuts in six meetings is more than will happen,” wrote John Donaldson, director of fixed income at Haverford Trust Co., in response to the survey. “This forecast is more consistent with a hard landing than a soft landing.”

Barry Knapp of Ironsides Macroeconomics says: “We suspect the FOMC will either underpromise or underdeliver, perhaps both.”

The poll comes on one side of a debate that has divided markets in recent days over whether the Fed should cut rates by 25 or 50 basis points, creating an unusually high level of uncertainty for a Fed that has announced its actions at nearly every meeting. (One basis point equals 0.01%)

The biggest difference may be that respondents seem less concerned about the wider economy than about the futures markets and are more confident that the Fed still has time to make gradual rate cuts. Seventy-four percent of respondents said the September rate cut would come in time to ensure a soft landing; only 15 percent said it was too late.

Overall, the probability of a soft landing is 53%, about the same as it has been since March. The probability of a recession, by contrast, has risen to 36%, 5 percentage points above its recent low in June but well below the 50% level that prevailed for much of 2022 and 2023. The growth outlook remained at 2% for this year, falling to 1.7% for 2025, two-tenths below the July survey but still at or near economic potential and not in recession.

“The economy is growing faster than expected in 2024, and the Fed has time to cut interest rates at a measured pace,” said Michael Englund of Action Economics.

“While economic risks are evident on the horizon, the Fed’s upcoming rate cuts will be more likely to follow a trend toward a mid-cycle correction, as seen in 1995, 1997 and 2019, than a trend toward an end-of-cycle recession,” wrote Guy LeBas, chief fixed income strategist at Janney Montgomery Scott.

Unemployment forecasts were slightly higher. Compared to the current rate of 4.2%, unemployment is expected to be 4.4% and 4.5% this year and next year, respectively. Both figures are about two tenths higher than in the last survey.

Not everyone believes the Fed still has time. “Powell’s legacy depends on him making a soft landing after waiting too long to raise rates in 2021,” says Diane Swonk, chief economist at KPMG US. “The window of opportunity to do so is getting smaller and smaller.” And Neil Dutta of Renaissance Macro Research rejects criticism that a half-percentage point cut would unsettle markets. He says there are real risks if the Fed raises just a quarter of a percentage point.

Stock valuations are likely to be roughly in line with a soft landing: 50 percent of respondents believe they are overvalued, 47 percent believe they are undervalued. However, 97 percent believe they are significantly or somewhat overvalued for a recession.

The S&P 500 has posted gains this year, according to the average forecast, with the index falling to 5,546 by year-end, just over 1 percent below current levels. The average forecast calls for the S&P to end next year at 5,806, just 3 percent higher.