🔊 See Fed Terminal Rate At 4% If Economy Does Not Slow: Goldman Sachs

Federal funds target terminal rate seen at 4% if the economy does not slow down, our baseline sees rates above 3% by mid-2023. The U.S. has an overheated labor market, higher inflation will erode wages. We see CPI around 5% as some goods inflation come off. Market pricing for federal funds rate already shows an inversion, the market is saying there's a meaningful risk of a recession.

- Goldman Sachs Chief Economist via BTV