Goldman Sachs: The Fed has good reason to cut interest rates in July
PANews reported on July 15 that Jan Hatzius, chief economist of Goldman Sachs, said that they believe that the Federal Reserve has "good reasons" to cut interest rates at the July meeting, but did not change their forecast that the Fed will start cutting interest rates in September. According to the latest unemployment and inflation data, a federal funds rate of 4% is appropriate, while it is currently 5.25%-5.5%. Therefore, it is expected that interest rate cuts will begin soon. Reasons for taking action in July include the volatility of monthly inflation, which may make the September rate cut difficult to explain if there is a temporary re-acceleration, and the Fed's undeniable motivation to "avoid starting to cut interest rates in the last two months of the presidential campaign." While this does not mean that the Fed cannot start cutting interest rates in September, it is indeed more appropriate in July.
