Goldman Sachs has revised its Federal Reserve forecast and now sees a 25-basis-point rate increase coming in October, citing the Fed’s latest projections as a reason to expect further tightening.
The bank previously predicted that the Fed would raise rates in September and then hold them steady. Its new outlook calls for another increase at the October policy meeting.
The forecast change follows the Fed’s 25-basis-point rate hike on Wednesday, which moved the target range to 3.75%–4.00%. The central bank’s updated projections showed that a strong majority of officials expect at least one more rate increase this year.
During the post-meeting press conference, Fed Chair Kevin Warsh maintained a hawkish stance. He said inflation was still “too high” and described the latest rate move as removing a “dose of accommodation,” indicating that monetary conditions may not yet be sufficiently restrictive.
Traders are currently assigning slightly above a 50% probability to another 25-basis-point hike in October, according to CME’s FedWatch tool.
Bitcoin was trading around $76,260, up roughly 0.5% over the past 24 hours.
