After the Federal Reserve significantly cut interest rates, Goldman Sachs changed its tune: interest rates will be cut by 25 basis points at each meeting before June next year
After the Federal Reserve became more aggressive in cutting interest rates by 50 basis points, Goldman Sachs changed its forecast. It is currently expected that from November 2024 to June 2025, the Federal Reserve will cut interest rates by 25 basis points at each meeting, whereas the previous forecast was for consecutive rate cuts this year and quarterly cuts next year. Goldman Sachs predicts that by June 2025, the final interest rate of the Federal Reserve will be between 3.25% and 3.5%. Analysts at Goldman Sachs believe that the main reason for further rate cuts is the recent signs of weakness in the U.S. job market, shifting the focus of the Federal Reserve from inflation concerns to employment risks. Goldman Sachs added that Federal Reserve Chairman Powell emphasized that the speed of the 50 basis point rate cut should not be seen as a new standard. Key factors for future decisions may be the next two employment reports
According to the Zhitong Finance and Economics APP, after the Federal Reserve took a more aggressive 50 basis point rate cut, Goldman Sachs has changed its forecast. It is currently expected that from November 2024 to June 2025, the Federal Reserve will cut rates by 25 basis points at each meeting, whereas the previous forecast was for consecutive rate cuts this year and quarterly cuts next year. Goldman Sachs expects the final rate of the Federal Reserve to be between 3.25% and 3.5% by June 2025.
Goldman Sachs analysts believe that the main reason for further rate cuts is the recent signs of weakness in the U.S. job market, shifting the focus of the Federal Reserve from inflation concerns to employment risks.
Goldman Sachs added that Federal Reserve Chairman Powell emphasized that the speed of the 50 basis point rate cut should not be seen as a new standard. The key factor for future decisions may be the next two employment reports