Goldman Sachs: September Fed rate hike unlikely

Goldman Sachs says a September Fed rate hike is unlikely due to cooling inflation and weak data. Market odds for a hike have dropped, supporting bitcoin’s stability.

Goldman Sachs has stated that market expectations for a Federal Reserve interest rate hike in September are overly aggressive and that such a move is highly unlikely. Analysts cite cooling inflation, weak retail sales, and softening employment data as key reasons for the Fed to keep rates steady. Market-implied odds of a rate hike have dropped to around 30.6%, with Goldman’s own estimate even lower. The July 2026 CPI data showed inflation at 3.4% year-over-year, down from the previous month, while wage growth has also softened. Bitcoin has remained stable in the $62,000 to $66,000 range, seeing a slight uptick after Goldman’s dovish signals. The bank expects inflation to improve further and believes market pricing for the federal funds rate remains too hawkish. Expectations for the next rate hike have shifted to January next year, with Goldman seeing further room for these expectations to fade.