Goldman Sachs expects the Federal Reserve to raise interest rates by 50 basis points each at its May and June 2022 meetings. This projection follows Chairman Jerome Powell's hawkish remarks.
"The Fed will have to move "fast" to raise interest rates and perhaps "more aggressively" to keep the price spiral from taking root," Powell said.
According to Goldman analysts in a report published late Monday, the Fed Chair's shift from 'stay' in January to 'quick' is a signal that interest rates will rise 50 bps at the upcoming meeting.
Goldman analysts also predict one rate hike at each Fed meeting in the second half of the year, and three hikes in 2023. However, they keep their forecast for the Fed rate at 3%-3.25%.
Last week, the Fed raised interest rates 25 basis points for the first time since 2018.
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