Goldman Sachs Pushes Back US Fed Rate Cut Forecast Following Soft Jobs Data

The wait for a pivot just got longer for global investors. Goldman Sachs has officially pushed back its forecast for the first US Federal Reserve rate cut, signaling that the central bank might keep borrowing costs high for longer than previously anticipated.

Goldman Sachs US Fed Rate Cut Forecast Revised

According to Reuters, the investment bank adjusted its timeline after analyzing recent soft jobs data. While cooling labor markets typically encourage rate cuts to stimulate growth, Goldman Sachs suggests the Fed will likely remain cautious, awaiting further confirmation that inflation is under control before easing policy.

Labor Market Softness and Policy Implications

The revised outlook reflects a shift in market sentiment. Analysts at Goldman Sachs believe that the current economic environment requires a more patient approach. This delay could have a ripple effect on mortgage rates, corporate borrowing, and emerging market currencies that are sensitive to US monetary policy.