Goldman Sachs Revises U.S. Interest Rate Forecasts Amid Tariff and Labor Market Dynamics
On Monday, Goldman Sachs adjusted its projection for U.S. interest rates. Citing diminished tariff effects and labor market weaknesses, the firm forecasts rate cuts of 75 basis points spread across September, October, and December 2025. Other financial institutions anticipate substantial rate reductions during the same period.
Goldman Sachs announced on Monday a revision to its forecast for U.S. interest rates in 2025, highlighting anticipated rate reductions due to less impactful tariffs and a fragile labor market.
The Wall Street giant is now predicting three separate 25 basis point rate cuts in September, October, and December, diverging from its earlier forecast of a single cut this year. Analysts noted that previous concerns over inflation linked to tariffs have lessened.
While other major banks, including Citigroup and Wells Fargo, expect a cumulative 75 basis point reduction, UBS projects even steeper cuts by 2025. The upcoming U.S. jobs report for June could further influence rate decisions, as signs of a weakening labor market emerge.
(With inputs from agencies.)
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