🟨 What’s happening: Goldman Sachs’ Chief Economist Jan Hatzius has reacted to soft labor data (likely weaker-than-expected jobs growth or rising unemployment) by saying the chances of a Federal Reserve rate cut in September have increased.
He’s even floating the possibility of additional cuts in October and December.
🟩 Why it matters:
Soft jobs data = slowing economy. The Fed might act to stimulate growth.
Lower rates = cheaper borrowing. Good for:
Businesses: Easier to finance expansion
Consumers: Lower mortgage/car loan/credit costs
Investors: Risk assets (like stocks and crypto) tend to benefit
Gold and #Bitcoin: #Often rise when real yields drop
🟥 Risks:
If inflation hasn’t cooled enough, rate cuts could spark a rebound in prices.
Too many cuts too fast = market overheating again
📉 Market Impact:
Stock market: Likely #bullish short-term
Gold, Bitcoin, growth stocks: Potential upside