Goldman Sachs Group Inc GS has cut its U.S. growth estimates for 2023 after the government recently boosted its predictions for Federal Reserve interest rate hikes, reports Bloomberg.
Here are the key takeaways:
- Goldman raised its federal funds rate forecast by 75 basis points over the last two weeks for a terminal rate forecast of 4% to 4.25% by the end of 2022.
- Also Read: How Is The Market Feeling About Goldman Sachs Group?
- Goldman raised forecasts for the unemployment rate, saying it will be about 3.7% by the end of 2022, compared with a call for 3.6% previously.
- The investment bank expects unemployment to increase to 4.1% by the end of 2023 versus 3.8% previously and to 4.2% by December 2024, compared with a prior estimate of 4%.
- Economists at Goldman said that the growth forecast is slightly below consensus and implies a below-potential growth trajectory that they believe is necessary to cool wage and price inflation.
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