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Goldman Sachs predicts Fed will cut interest rates in September
Summary: In a surprising move, Goldman Sachs predicts that the Federal Reserve will cut interest rates in September, three months earlier than previously forecasted. This shift reflects early signs that inflation related to tariffs is milder than expected, while anti-inflation forces - including slowing wage growth and weakening demand - are forming. The bank's chief economist ...
In a surprising move, Goldman Sachs predicts that the Federal Reserve will cut interest rates in September, three months earlier than previously forecasted. This shift reflects early signs that inflation related to tariffs is milder than expected, while anti-inflation forces - including slowing wage growth and weakening demand - are forming.
The bank's chief economist for the United States, David Mericle, estimates that the probability of a rate cut in September is slightly higher than 50%, with expected cuts of 25 basis points in September, October, and December, followed by two more cuts in early 2026. Goldman Sachs also revised its terminal rate expectations from 3.5%-3.75% to 3%-3.25%.
