Goldman Sees Strong US Growth, Mild Inflation and Two Fed Rate Cuts in 2026
Goldman Sachs projects robust U.S. economic growth in 2026 alongside tempered inflation, and anticipates the Federal Reserve will cut rates twice. In its Jan. 11 "2026 U.S. Economic Outlook," Goldman forecasts GDP growth of 2.5% year‑over‑year in Q4 (2.8% for the full year), core PCE inflation easing to 2.1% by December, and core CPI slowing to about 2.0%. The bank expects two 25-basis-point Fed cuts in June and September due to increased uncertainty in labor market prospects, with a baseline unemployment rate around 4.5%. Goldman flags a risk of a period of "no employment growth" as firms adopt AI to reduce labor costs. On trade policy, the firm assumes political pressure over living costs ahead of midterms will limit further large tariff increases. The outlook emphasizes fiscal support from tax cuts, rising real wages and household wealth as growth drivers. This view suggests milder inflation and a friendlier rate path that could influence risk assets and interest-rate sensitive markets.
Neutral
Goldman’s outlook — stronger GDP, milder inflation and two Fed cuts — has mixed implications for crypto markets. Lower interest rates and a benign inflation trajectory are generally supportive for risk assets, including cryptocurrencies, because easing rates can reduce dollar funding pressures and increase carry into higher-risk assets (bullish). At the same time, a stronger US economy and stable employment reduce the perceived need for aggressive monetary stimulus beyond the two modest cuts, which may cap upside in highly rate-sensitive or speculative crypto segments (neutral-to-moderate effect). The market may react positively in the short term to a clearer dovish Fed path (June and September cuts), boosting crypto prices on rate-cut anticipation. However, the risk of AI-driven job disruption raises macro uncertainty; if it materializes into weaker consumption or tighter regulation, that could weigh on risk appetite. Historically, announcements of expected Fed easing (or lower inflation) have supported crypto rallies initially, but sustained gains depend on actual rate cuts and liquidity conditions. Overall impact is neutral: mildly bullish on the margin but not a clear accelerator without further monetary or fiscal accommodation.