Goldman Sachs Raises Federal Reserve Interest Rate Forecast
The firm expects another 25-basis-point hike in March following higher-than-expected October inflation data.
Goldman Sachs has updated its outlook for United States monetary policy. The firm now projects an additional 25-basis-point interest rate hike in March 2025.
The shift follows October inflation data that exceeded market expectations. The previous scenario anticipated the end of the hiking cycle in December of this year.
Deutsche Bank has also adjusted its estimates and now expects increases in January and March. The Federal Reserve raised rates to a range of 3.75% to 4.00% in September.
Inflationary pressures stem from rising oil prices and import tariffs. Investment in artificial intelligence and resilient consumer demand also contribute to the current landscape.
Economist David Mericle assesses that inflation may retreat slightly before gaining momentum early next year. The firm now projects that the interest rate cut cycle will only begin in December 2027.
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