Goldman Sachs drops a curveball on interest-rate cuts

Group 1 - Goldman Sachs has revised its outlook on interest rates, pushing expected rate cuts to June and September 2026, indicating a slower easing process and lower recession risk [5][7] - The economic environment is normalizing, supported by benign inflation reports, durable growth, and reduced recession fears, leading to a more patient Federal Reserve [2][3] - The Federal Reserve's messaging aligns with a data-dependent approach, emphasizing the importance of fundamentals such as earnings and consumer demand in the current market context [3] Group 2 - Goldman Sachs has reduced its 12-month recession probability from 30% to 20%, reflecting increased confidence in the economy's resilience to higher rates [8]