tenkararod| Goldman Sachs: Postponing the Fed's first interest rate cut from July to September

Goldman Sachs: Postponing the Fed's first interest rate cut from July to September

Source: Zhao Ying from Wall Street

Goldman Sachs maintains its expectation of cutting interest rates twice this year, with the second rate cut likely in December.

Goldman Sachs adjusted its forecast for the timing of the Federal Reserve's first interest rate cut, replacing the original July ratetenkararodThe judgment was postponed until September.

On Friday, Goldman Sachs analyst Jan Hatzius pointed out in his latest report:

Earlier this week, we pointed out that pushing the Federal Reserve to cut interest rates in July requires not only better inflation data, but also significant signs of weakness in economic activity or job market data.

But with the stronger-than-expected manufacturing PMI data in May and the decline in initial jobless claims, a rate cut in July is unlikely to be achieved.

Goldman Sachs 'latest forecast is consistent with market expectations. According to CME FedWatch Tool, the probability of a rate cut in September is 54%, compared with only 12% in July.

Based on pricing in the swap market, the Fed's first interest rate cut was fully priced in December, and the probability of a second interest rate cut is less than 40%, compared with about 70% last week.

JPMorgan Chase and Citigroup are among the few investment banks still predicting action in July.

Goldman Sachs maintains its judgment that it expects the Fed to "cut interest rates every quarter or every two meetings," which means that the second rate cut will be postponed to December from the previously expected October. Goldman Sachs 'expectation for the Federal Reserve to cut interest rates twice in 2024 remains unchanged.

Goldman Sachs said:

First of all, we continue to believe that the Fed's interest rate cuts are "optional", so there is no need to rush it.

Secondly, although inflation data may improve further by September, the year-on-year level is still above the 2% target, making the decision to cut interest rates at that time seem "unwise".

Third, although the top management of the Federal Reserve and we are relatively relaxed about the inflation outlook, we are preparing to cut interest rates in the near future. However, some officials within the FOMC are still worried about inflation and are cautious about cutting interest rates.

Risk warnings and exemption clauses

The market is risky and investment needs to be cautious. This article does not constitute personal investment advice, nor does it take into account the specific investment goals, financial conditions or needs of individual users. Users should consider whether any opinions, opinions or conclusions contained in this article are consistent with their specific circumstances. If you invest accordingly, you will be responsible.

Tags:

Prev: gamemaniabingo| Weineng Group (01608.HK): Annual shareholders 'meeting approved Deloitte to take over as auditor
Next: fortuneslots| Yatong New Materials avoids some regulatory inquiries and refuses to answer comparable companies have multiple versions of "willful" switching| Reviewing Haitong IPO projects