Goldman Sachs chief economist Jan Hatzius said on August 7 that the Federal Reserve is likely to place greater weight on inflation data than employment in future policy decisions. Hatzius stated that upcoming inflation figures will reveal whether June's slowdown was a one-off or the start of a softer trend, with Goldman expecting further cooling. The bank has shifted its rate-cut forecast multiple times this year, most recently removing two 2026 cuts and projecting quarter-point reductions in June and December 2027, assigning only 30% odds to that scenario. Goldman believes sustained evidence of inflation converging toward 2% is needed before easing, making inflation the more critical variable for determining interest rates.
Goldman Sachs Group IncGoldman's chief economist discusses Fed policy and rate-cut forecasts, affecting the bank's outlook but not its own financials.
