Goldman Sachs is pessimistic about the Federal Reserve's rate hike expectations this year

SmartContractAuditor · 2026-04-01T06:24:34+00:00

Goldman Sachs analysts point out that since the Iran-U.S. war, the U.S. federal funds rate has been highly volatile, but the likelihood of rate hikes this year remains low. Supply shocks are limited, and the risk of inflation spillovers is low. The Federal Reserve is unlikely to adopt tightening policies solely due to oil shocks.

SmartContractAuditor

2026-04-01 06:24:34

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Odaily Planet Daily News: Goldman Sachs analysts stated in a report that since the outbreak of the war between Iran and Israel, market expectations for the U.S. federal funds rate have fluctuated sharply, but the likelihood of further rate hikes this year remains relatively low. The analysts noted that the current size of the supply shock is small and more limited than those that previously triggered inflation issues in the 20th century, and that the increase in oil prices is also less than during the 1970s. Additionally, they believe that “the starting point of the economy makes it less likely for inflation to spill over broadly,” and that the current monetary policy starting point also reduces the probability of rate hikes. The analysts emphasized: “The Federal Reserve usually does not tighten policy solely in response to an oil shock.” (Jin10)

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