Rate Cuts On The Horizon: Goldman Sachs Forecasts Q2 2024 Reduction With Current Hawkish-Hold Climate In Mind
Portfolio Pulse from Piero Cingari
Goldman Sachs economists predict that the Federal Open Market Committee (FOMC) should initiate rate cuts in Q2 2024, aligning with a period when core PCE inflation is expected to drop below 3% YoY and fall below 2.5% on a monthly annualized basis. The rate cut cycle involves a gradual reduction of 25 basis points per quarter, but the pace remains uncertain. The funds rate is expected to stabilize within the range of 3-3.25%, surpassing the FOMC’s median longer-run projection of 2.5%. In the short term, the FOMC is expected to abstain from a rate hike during the September meeting.
August 14, 2023 | 12:50 pm
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NEUTRAL IMPACT
Goldman Sachs economists predict rate cuts in Q2 2024, with the funds rate expected to stabilize at 3-3.25%. The pace of these cuts remains uncertain. In the short term, the FOMC is expected to abstain from a rate hike during the September meeting.
The news directly pertains to Goldman Sachs as it is their economists making the prediction. The impact on the stock price is neutral in the short term as the predicted rate cuts are not immediate and the pace remains uncertain. However, this could influence investor sentiment towards the company's analytical capabilities.
CONFIDENCE 85
IMPORTANCE 75
RELEVANCE 100