Goldman Sachs economists expect four interest rate cuts in 2024, with the first rate cut expected to take place in June.
The Fed’s statements suggest that the first rate cut may not happen in March, and all eyes are now focused on May, but Goldman Sachs thinks differently.
At this time, Goldman Sachs economists said in a recent report that they expect there will be four interest rate cuts in the U.S. in 2024, and they estimate that the first rate cut will occur in June.
Economists believe that although the latest inflation data in January is higher than expected, it should not be overemphasized. Economists predict that core inflation will drop to 2.5% before the FOMC meeting in May and to 2.2% in June.
The latest predictions from Goldman Sachs economists are: “We predict interest rate cuts in June, July, September, and December 2024, and four more rate cuts in 2025.”
According to CME Group’s FED Watch tool, the probability of keeping interest rates unchanged in May is priced at 76%, while the probability of a 25 basis point rate cut is priced at 23%.
On the other hand, the probability of the FED keeping interest rates unchanged in June is priced at 32%, while the probability of a 25 basis point rate cut is priced at 53.7%.
Prior to that, the FED maintained the interest rate decision in January, in line with expectations, and kept interest rates unchanged at 5.25-5.50%.
There is expected increase in the price of Bitcoin (BTC) and cryptocurrencies as the FED starts cutting interest rates.
Because Bitcoin reached a peak of $69,000 in November 2021, when the FED began raising interest rates. As the next bear market is directly related to the FED’s interest rate hike, people believe that BTC may return to its old era with policy changes and rate cuts.
Experts expect the price of BTC to rise sharply if rate cuts occur immediately after the Bitcoin Halving.
Experts predict that rate cuts after April will push the price of BTC to new highs.
