Rationale for Delayed Rate Hike
Goldman Sachs, a leading investment bank, predicts that there will be no interest rate hike in November. According to their strategists, several factors contribute to this prediction. They believe that the labor market needs further rebalancing before the Federal Reserve considers raising rates. Additionally, promising developments in inflation may ease the pressure for an immediate rate hike. The strategists also mention an anticipated slowdown in economic growth in the fourth quarter, which could lead to a delay in rate increases as the Federal Reserve wants to assess the economy’s resilience.
Probability on Rate Hikes
Market participants are closely monitoring the Fed’s moves and sentiments, with some major investors suggesting that the Central Bank may have concluded its rate hike cycle. Futures tied to the Fed’s benchmark overnight interest rate indicate that market participants expect no change in rates at the upcoming meeting. The probability of rates remaining steady at the next meeting stands at approximately 72%. These odds reflect market sentiments aligned with a unanimous vote by the Fed to keep interest rates steady.
Hot Take: Goldman Sachs Predicts Delayed Interest Rate Hike
Goldman Sachs has made a bold prediction that there will be no interest rate hike in November. The bank’s strategists point to factors such as the need for further labor market rebalancing, promising developments in inflation, and an anticipated slowdown in economic growth as reasons for this prediction. Market participants are closely watching the Fed’s moves and sentiments, with many expecting no change in rates at the upcoming meeting. These predictions reflect market sentiments aligned with a unanimous vote by the Fed to maintain steady interest rates.
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