HomeFinancial MarketsGoldman Sachs Forecasts Fed Rate Cut in Q4 Of 2024

Goldman Sachs Forecasts Fed Rate Cut in Q4 Of 2024

Goldman Sachs economists have revised their forecasts for the earliest date that the Federal Reserve might be expected to introduce an interest rate cut. While the investment firm’s economists previously expected a rate cu in the second quarter of 2024, they have pushed their forecast to the fourth quarter of the year.

The Federal Reserve decided to keep interest rates unchanged at its meeting on Wednesday, thereby holding them within the 5.25% to 5.5% range. They are currently expected to cut interest rates by a total of 50 basis points next year as opposed to previous estimates of a full percentage point.

“We think this means that inflation will have to fall further than we previously assumed for the FOMC to cut.” Goldman Sachs economists led by Jan Hatzius wrote in a note, explaining the change to their initial forecasts. Several other financial giants disagree with Goldman Sachs’ assessment, however. Barclays is expecting an interest rate cut in each of the Fed’s final three meetings of 2024, while Morgan Stanley expects the first cut to be delivered as soon as March next year.

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