Goldman Sachs now expects three more Fed rate hikes in 2023

Goldman Sachs said it now expects the Federal Reserve to raise interest rates 3 times this year, by a quarter of a percentage point each time, after data this week indicated rising inflation and a strong labor market.

A report on Thursday showed that producer prices in January accelerated by the largest margin in 7 months, while another report showed that the number of Americans filing new applications for unemployment benefits fell unexpectedly last week.

Financial markets currently estimate that the final interest rate will reach 5.3% by July.

Most economists polled by Reuters ahead of the latest US data expected the Fed to raise interest rates at least twice more in the coming months, given the possibility that interest rate increases will remain significant, and none of them expected a rate cut this year..