Goldman Sachs: Fed unlikely to cut rates because of weak "soft data"

Surveys of U.S. consumers and businesses are showing an anxious economic mood, but underlying data are yet to show a serious slowdown. The Federal Reserve is unlikely to ease policy based on "soft data" alone, especially since in the recent past, soft data has falsely signaled an impending recession, such as during the Fed's fight against inflation in 2022, Goldman Sachs economists wrote. The Fed "also wants to see evidence of labor market and other hard data before cutting rates," Goldman's team wrote. The investment bank, like others on Wall Street, believes the Fed will keep rates on hold in Wednesday's rate decision.