Fed to cut rates in September — updated Goldman Sachs forecast

Goldman Sachs has revised its forecast to predict an earlier interest rate cut by the Federal Reserve (Fed) in September, moving up from the previously expected December timeline. The updated outlook cites various disinflationary factors and notes that the impact of US tariff policy has been less significant than anticipated.

According to David Mericle, chief US economist at Goldman Sachs Research, despite strong labor market data, job searches remain challenging. He points to changes in immigration policy and the risk of lower wage growth in the near term as contributing factors.

The analyst places the probability of September monetary policy easing above 50%. Goldman Sachs' team forecasts 25-basis-point cuts in September, October, and December, with two additional reductions of the same magnitude expected in March and June 2026.