Goldman Sachs Trims 2019 Growth Forecast

Goldman Sachs has trimmed its growth forecast for the first half of 2019 from an earlier 2.4% to a modified 2% and a less than 2% for the latter six months of the year. The change comes in the wake of mellowed economic data and extreme volatility in the financial markets.
However, it remains unworried as it does not fear a complete downturn of the economy in the months to come. The reason for the absence of concern at the banking giant was an absence of asset market bubbles and inflationary overheating and they felt that the market was moving towards a correction.
The analysts voiced their opinion about a reversal of the rate hikes by the Federal Reserve in the year 2020. Four rates were seen in the current year and two were predicted for 2019. Chief economist and strategist at Gluskin Sheff, David Rosenberg too shared the Goldman opinion about Fed policy on rate hikes and cuts. He added that his view was met with laughs and jeers by people all around but they were the ones not remembering history.
This assessment was made public after the bank explained that the adverse effect of interest rate hikes and falling stocks would be counterbalanced by increased wages and retreating oil prices. Employment market remained strong and price pressures were in check and these two factors bode well for the economy. Goldman estimated that the unemployment rate would fall as low as 3.25% by the close of 2019. A reasonably increased inflation arising due to a constricted labor market and increased tariff rates; an outcome of the ensuing U.S.-China trade war could be expected and this could lead to a 2.1% rise in core prices.
The banking giant definitely assuaged the worries of many people who feared a recession in the forthcoming year.