The economists of Goldman Sachs no longer expect the US Federal Reserve to raise interest rates in Juneaccording to an analysis note published Wednesday following data showing that Consumer prices cooled faster than expected in March.
Previously, Goldman Sachs expected back-to-back rate hikes at the Fed’s May and June meetings. The firm’s economists, led by Jan Hatziusindicated in the note that they continue to expect an increase in May.
The inflation in the US went up to 5% pa in March, below the expected 5.2% and 6.0% in February, which continues to confirm the slowdown in the rise in prices. News that the US Federal Reserve (Fed) will point out ahead of its next interest rate meeting in May. In this way, the CPI touches minimums of almost 2 years and yields for the ninth consecutive month.
Market expectations are now that the Fed will raise interest rates an additional 25 basis points at some point in the next two months to begin lowering the price of money from then on. However, the debate is still fully open.
The moderation in prices is bringing the end of the cycle of monetary tightening that is generating so much turmoil in the markets.
Market expectations are now that the Fed will raise interest rates an additional 25 basis points at some point in the next two months to begin lowering the price of money from then on. However, the debate is still fully open.
The president of the Federal Reserve from San Francisco, Mary Daley, He said Wednesday that while the strength of the US economy, tight labor markets and very high inflation suggest there is “more work to be done” on the Fed’s rate hikes, other factors such as tightening of credit conditions, they might argue for a pause.
“Looking ahead, there are good reasons to think that the monetary policy may have to tighten further to reduce inflation“he said in remarks prepared for the Salt Lake Chamber in Salt Lake City, Utah.
“But there are also good reasons to think that the economy may continue to slow even without further policy tightening.”
The monetary entity will meet on May 3 to resume the discussion on rates.
Source: Ambito
