The Federal Reserve (Fed) is expected to be more aggressive in raising interest rates this year following the very rapid inflation surge in the United States.
Goldman Sachs analysts expect four rate hikes this year due to the contagion of the Omicon variant that exacerbated inflation to the point of prompting the Fed to raise rates faster.
According to forecasts shown by Goldman Sachs, there were four increases in March, June, September and December.
What is even more surprising, however, is that there is a possibility that the Federal Open Market Committee (FOMC) will take more ‘crazy’ action by raising rates every time a meeting is held until the picture of inflation changes.
This raises the possibility that a reduction in the balance sheet will be made earlier in May and there will be more than four rate increases this year.
Even so, the FOMC policy meeting this week is expected to see no action on interest rates to be taken, but assumes the committee will announce a hike in March.
If that happens, it will be the first hike in U.S. central bank interest rates since December 2018.
