Goldman Sachs Cancels 2026 Rate-Cut Forecast, Delays Fed Cuts to June and December 2027

According to BlockBeats, Goldman Sachs on June 8 cancelled its forecast for U.S. Federal Reserve rate cuts in 2026, citing a stronger-than-expected labor market. The investment bank pushed back its expected timing for the Fed's final two rate cuts to June and December 2027, from its prior forecast of December 2026 and March 2027.

May U.S. job growth exceeded all expectations, reinforcing labor market resilience. Goldman raised its probability of Fed rate hikes from 10% to 20%, though Chief U.S. Economist David Mericle noted deflation risks remain low. The firm maintained its baseline forecast of two 25-basis-point cuts in 2027, at 30% probability, and lowered its 2026 unemployment rate forecast to 4.4% from 4.6%.