Goldman Sachs Shifts FOMC Forecast to Two-Hike Path

Goldman Sachs has updated its forecast for the Federal Open Market Committee (FOMC) to expect a second 25bps hike in October, replacing its previous expectation of a single September hike. This change reflects a shift from a 'one-and-done' view to a two-meeting path, indicating persistence rather than timing.

The bank's economists have not provided fresh data as the basis for this revision but are instead reinterpreting official communications. The market reaction will be closely watched, particularly in money-market futures around the meetings in question.

The change is seen as a directional signal, and its impact on the market may be more significant than the call itself. Historically, when one major forecaster extends the expected tightening path, others tend to follow within days, moving the consensus and influencing front-end and OIS pricing.