Goldman Sachs said it forecast seven 25-bp hikes in the U.S. interest rate by the Federal Reserve this year, up from five previously estimated, updating its forecast after last Thursday’s U.S. inflation data. ).
US consumer prices rose 7.5% last month on an annual basis, above economists’ estimates of 7.3% and the biggest annual jump in inflation in 40 years, further adding to pressure on the country’s central bank. to raise interest rates more aggressively.
Ryan Wang, an economist at HSBC, said the bank now expects the Fed to move further than previously anticipated, with a 50-bp hike in March and four additional 25-point hikes in 2022.
According to HSBC, this will raise interest rates from 0-0.25% to 1.50-1.75%.
“This would equate to 150 basis points in rate hikes this year, versus our previous forecast of three 25-point hikes,” Wang said in a note.
Deutsche Bank said in a daily note to markets that its economists also upped their bet for a 50 basis point hike in March by the Fed, as well as five more 25-point hikes in 2022, with hikes in all but November meetings. , totaling 175 basis points in 2022.
Deutsche economists “also highlight the growing risk of a recession in 2023 or 2024,” according to the note.
Source: CNN Brasil
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