(Reuters) – Goldman Sachs does not expect a further rate hike from the U.S. Federal Reserve (Fed) this month and sees significant uncertainty beyond March amid recent stress in the banking sector, analysts said on Sunday. of the American investment bank.
Operating as Silicon Valley Bank (SVB), SVB Financial Group collapsed on the stock market last week after a surprise capital increase intended to make up for a loss of 1.8 billion dollars, following the sale of a bond portfolio.
Prior to the rout, Goldman was forecasting a 25 basis point hike in the fed funds target after the US central bank’s March 21-22 monetary policy meeting.
On Friday, Californian authorities announced the closure of SVB and the possibility for customers to withdraw their deposits as of Monday, while the Fed pledged to make funds available, via a new bank financing program, for the establishments that need it.
According to Goldman Sachs analysts, the measures taken by the regulatory authorities should provide banks with more liquidity in the face of the threat of deposit withdrawals and improve customer confidence.
Goldman Sachs left unchanged its forecast for a 25 basis point rate hike in May, June and July, but said it expects considerable uncertainty about the rate hike path beyond March.
The Fed terminal rate is now seen by Goldman Sachs at 5.25%-5.5%.
(Shubham Kalia report in Bangalore; Claude Chendjou, edited by Blandine Hénault)
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