Economists at Goldman Sachs bring out their new call on the US Federal Reserve (Fed), following Wednesday’s dovish outcome.

Key quotes

"The FOMC raised the funds rate by 25bp to 4.75-5%, against our expectation of a pause, but projected a weak economic outlook for the rest of 2023 and a more cautious path for the funds rate than Chair Powell had indicated was likely before the recent banking turmoil.”

"We have left our forecast for the peak funds rate unchanged at 5.25-5.5% and now expect additional 25bp rate hikes in May and June.”

“Our baseline forecast is 25bp above the FOMC's forecast of 5-5.25%, and our weighted-average path for the funds rate is above market pricing.”