Goldman Sachs say the Fed could hike to 5% by March 2023 (GS raise rate call by 25bp)

Adding to the hawkish Fed outlook already this morning from this:

• WSJ Fed insider Timiraos suggests Fed could hold on to "Higher Interest Rates for Longer"

A piece on the Federal Reserve Federal Reserve The Federal Reserve System, more commonly known as the Fed, represents the central banking system of the United States. Like other central banks globally, the Fed is responsible for monetary policy, in this case in the US.The Fed is one of the most watched and followed entities for forex traders, given its material impact on the US dollar. Founded initially in 1913, the Fed was created to perform a wide range of functions. This includes stabilizing and maintaining flexible monetary policy in the The Federal Reserve System, more commonly known as the Fed, represents the central banking system of the United States. Like other central banks globally, the Fed is responsible for monetary policy, in this case in the US.The Fed is one of the most watched and followed entities for forex traders, given its material impact on the US dollar. Founded initially in 1913, the Fed was created to perform a wide range of functions. This includes stabilizing and maintaining flexible monetary policy in the Read this Term outlook from Goldman Sachs via Bloomberg over the weekend.

GS are looking for 5% by March '23. This is up 25 basis points from their previous forecast. GS project:

• +75 basis points at the meeting this week (meeting is November 1 and 2)
• +50 bp in December
• +25 bbp in February
• +25bp in March

GS cite 3 three reasons for hike beyond February:

• "uncomfortably high" inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term
• its necessary to slow the economy as fiscal tightening ends and price-adjusted incomes rise
• avoiding a premature easing of financial conditions

Graph from the Fed, the Banks's funds rate: