Goldman Sachs: No longer expects Fed to cut interest rates this year due to strong labor market

Goldman Sachs economists said the Fed is no longer expected to cut interest rates this year due to a stronger-than-expected labor market. The bank postponed its expected time for the last two Fed interest rate cuts from December 2026 and March 2027 to June and December 2027. Merick, chief U.S. economist at Goldman Sachs, pointed out that although it is unlikely to raise interest rates, the probability of a small interest rate hike will be raised from 10% to 20%. Goldman Sachs also lowered its forecast for U.S. unemployment this year to 4.4%, from 4.6%.