Goldman Sachs, JP Morgan expect September Fed hike as inflation lingers

Live updates

1. 39d ago

   Goldman Sachs forecasts second rate hike in October

   Goldman Sachs now expects the Federal Reserve to increase interest rates in October following signals from policymakers regarding further tightening. This follows a broader consensus among institutions like JPMorgan and Bank of America that the Fed will raise the overnight funds rate by a quarter point in September. Traders currently assign a probability higher than 90% to a September hike, which would be the first rate increase in three years. Persistent inflation and oil-driven wholesale price increases continue to drive the expectation for tighter monetary policy.

   Why it matters

   The Federal Reserve manages inflation by adjusting the overnight funds rate to influence borrowing costs. A series of hikes would mark a shift away from the three-year period of steady rates. Disagreement remains among major banks, as Morgan Stanley expects rates to remain unchanged.

   Still unconfirmed

   • Goldman Sachs expects the US Federal Reserve to raise interest rates again in October.
   • Traders assign a better than 90% probability that the Federal Open Market Committee will raise the overnight funds rate by a quarter point.
   • Morgan Stanley forecasts the Fed will hold rates steady.

   What to watch next

   • The Federal Open Market Committee decision on the September overnight funds rate
   • Official Fed policy statements regarding October tightening risks
   Sources used for this update (2)

   1. finance.yahoo.com — Goldman's October hike call underscores renewed Fed tightening risks
   2. www.briefs.co — SoftBank lines up $11B-plus high-yield bond sale to fuel OpenAI investment
   confidence 80%
2. 44d ago

   Wall Street expects Federal Reserve rate hike tomorrow

   Traders assign a better than 90% probability that the Federal Open Market Committee will raise the overnight funds rate by a quarter point. This would mark the first interest rate increase in three years. While Goldman Sachs, JPMorgan, Bank of America, and other institutions anticipate the hike, Morgan Stanley forecasts the Fed will hold rates steady. The move follows persistent inflation and rising wholesale prices driven by oil costs.

   Why it matters

   The Federal Reserve manages US inflation by adjusting the cost of borrowing. A rate hike increases costs for consumers and businesses to cool the economy. This decision follows years of stable or falling rates.

   What is confirmed

   • Traders assign a better than 90% probability that the FOMC will raise the overnight funds rate a quarter point.
   • The Federal Reserve is expected to hike interest rates for the first time in three years.
   • Goldman Sachs and JPMorgan expect a Fed rate hike.

   Still unconfirmed

   • A viral list claims nine banks expect a Fed rate hike this week.
   • Morgan Stanley forecasts the Fed will hold rates.

   What to watch next

   • The official FOMC policy decision and rate announcement tomorrow.
   • Chairman Kevin Warsh's commentary on inflation and future rate paths.
   Sources used for this update (5)

   1. finance.yahoo.com — Fed meeting live updates: Anticipation builds with Fed expected to hike interest rates for first time in 3 years
   2. news.bitcoin.com — Goldman, JPMorgan, BofA, Morgan Stanley and More Expect a Fed Hike Tomorrow
   3. www.cnbc.com — The Federal Reserve is expected to hike rates for the first time in three years: Live updates
   4. www.briefs.co — Wall Street courts Europe's AI datacenter debt boom
   5. www.briefs.co — Holtec hits pause on IPO as markets wobble
   confidence 90%
3. 46d ago

   Goldman Sachs, JPMorgan Expect Fed Rate Hike This Week

   Major financial institutions including Goldman Sachs, JPMorgan, HSBC, and Deutsche Bank forecast a quarter-point increase at the Federal Reserve. This shift follows stronger-than-expected inflation readings and rising oil prices that pushed US wholesale prices higher, raising doubts about persistent price pressures. The market views a potential rate increase as imminent, setting the stage for the first interest rate hike by the Fed in years. Wall Street expectations have coalesced around this move for the upcoming policy decision.

   Why it matters

   The anticipated policy shift comes after a prolonged period where the central bank kept rates steady since 2023. Stubborn inflation indicators, specifically climbing wholesale prices and oil costs, forced major banks to flip their forecasts. This action places Fed official Warsh on a potential collision course with Trump as the rate hike looms.

   What is confirmed

   • Goldman Sachs, JPMorgan, HSBC, and Deutsche Bank all forecast a quarter-point increase at the Fed.
   • US wholesale prices rose in the latest sign of stubborn inflation as oil prices continue to climb.

   Still unconfirmed

   • The crypto market is bracing for huge volatility in Bitcoin, Ethereum, and XRP due to the macro-heavy week.
   • Fed's Warsh is on a collision course with Trump as a rate hike looms.

   What to watch next

   • The official interest rate decision by the Federal Reserve this week.
   • Potential policy announcements addressing stubborn inflation and climbing oil prices.
   Sources used for this update (11)

   1. AP News — US wholesale prices rise in latest sign of stubborn inflation as oil prices continue to climb
   2. WSJ — The Fed Is Poised to Raise Interest Rates for the First Time in Years
   3. Forbes — Why The Fed Is Likely To Raise Rates This Week
   4. Bloomberg.com — Fed’s Warsh on Collision Course With Trump as Rate Hike Looms
   5. reuters.com — Goldman Sachs flips forecast, now sees September Fed rate hike
   6. USA Today — Is it finally time? Why the Fed may raise rates for first time since 2023.
   7. Yahoo Finance — The market says a Fed rate hike is a done deal. Here's why it might hold steady.
   8. finance.yahoo.com — Goldman Sachs, JPMorgan expect Fed rate hike this week
   9. www.aol.com — Global banks coalesce around Fed hike call after inflation surprises
   10. finance.yahoo.com — Crypto Market Braces for Volatility as Goldman Sachs & JPMorgan Expect Fed Rate Hike This Week
   11. www.zawya.com — AmiViz to show architecture-first security at GISEC Global
   confidence 95%