Goldman Sachs: Fed to indicate September rate cut 'more likely'
Recent comments from Federal Reserve officials signal they will likely remain on hold at their upcoming meeting, but the prospect of a first interest rate cut has become more probable, according to Goldman Sachs economists.
Another reason for the shift in Fed officials' tone is the rise in the unemployment rate, which has increased by 0.1 percentage points for the past three months, reaching 4.1%. This represents a 0.7 percentage point increase from its lowest point, or nearly 0.5 percentage points on a three-month average basis.
"We expect these recent trends in the data will lead the FOMC to revise its statement at next week’s meeting in ways that will hint that a cut at the following meeting in September has become more likely.”
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