Fed Interest Rate Hike Looms as Inflation Concerns Mount

The US Federal Reserve (Fed) is likely to raise interest rates this week due to stronger-than-expected inflation readings, according to Goldman Sachs and JP Morgan.

Goldman Sachs abandoned its previous call for rates to remain unchanged and now expects a 25-basis-point increase at the Fed's meeting. The bank also forecasts quarter-point hikes in both September and December.

JP Morgan predicts that interest rates will rise by a quarter point in both September and December, as recent data has revived concerns about reaching the Fed's 2% inflation target.