Goldman Expects Interest Rate Hike By 50bps at May, June Meetings: Reuters

Goldman Sachs Group Inc GS expects the U.S. Federal Reserve to raise interest rates by 50 basis points each at its May and June meetings, following remarks by Jerome Powell, Federal Reserve's chairman.

Reuters reported that the Fed must move "expeditiously" to raise rates and possibly "more aggressively" to keep an upward price spiral from getting entrenched, Powell said on Monday. 

"Our best guess is that the shift in wording from 'steadily' in January to 'expeditiously' today is a signal that a 50bp rate hike is coming," the analysts wrote in a report published late on Monday.

The Fed raised rates last week for the first time since 2018. 

Also See: Investors Adjust After Tightened Monetary Policy, Some Expect Steeper Path Ahead: Reuters.

They anticipate four further 25 basis point rate hikes in 2022, one at each Fed meeting in the second half of this year, and three in 2023. The analysts, however, left their forecast for the Fed's terminal rate unchanged at 3%-3.25%.

Price Action: GS shares are up 0.88% at $342.00 during the premarket session on the last check Tuesday.

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Posted In: NewsTop StoriesEconomicsFederal ReserveMarketsGeneral
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!