Goldman Sachs chief economist Hatzius: two additional Fed rate hikes likely more appropriate; odds of a single December hike have decreased
What happened
Goldman Sachs chief economist Jan Hatzius said in a note reported Oct 8 by The Fly that two additional Fed rate hikes would likely be 'more appropriate' and that the odds of a singular December hike have decreased. The call follows Fed Governor Christopher Waller's hawkish remarks at a Central Bank of Turkey forum in Istanbul on Oct 8, where Waller said additional hikes would likely be needed to return inflation to 2% but that they 'do not need to come at consecutive meetings.' Hatzius characterized Waller's speech as a hawkish shift from his earlier emphasis on three-month annualized core PCE, though Goldman still officially expects one 25 bps hike in December.
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Start your free 14-day trialWho’s affected
- Broad market (S&P 500, Nasdaq) — rate-sensitive growth and AI names most exposed
- Treasury-sensitive sectors: banks, real estate, homebuilders — higher rates compress lending margins and raise borrowing costs
- Bonds — further hikes would push already 24-year-high yields higher
Sources