Goldman Sachs Adds March Rate Hike to Fed Outlook After Hotter October Inflation

Goldman Sachs has revised its Federal Reserve policy trajectory, projecting interest rate hikes of 25 basis points in both December and March, while keeping a January move on the table. The revisions would raise the federal funds target rate to 4.25%-4.5%. The hawkish adjustment follows October core consumer price index data reaching 3.75%, marking three straight months of worsening inflation outlooks. Goldman Sachs expects prolonged monetary tightening, forecasting rate cuts will be delayed until December 2027 before gradually lowering the terminal rate to 3.25%-3.5% by September 2028.