Goldman Sachs still thinks a July rate cut is more likely

Jan Hatzius, chief economist at Goldman Sachs, was on CNBC and said this:

• I am quite convinced that the trend in salaries is downward.
• If we look at other indications like the Atlanta tracker, the salary trend is downward
• I expect ‘much better’ PCE numbers in Q2
• A reduction in July remains a reasonable baseline, but it remains more likely in our view.

I often write that when an economist says “again,” it means he has lost confidence. This is not a big surprise given that Goldman Sachs is far from the consensus on a July rate cut.

That said, they crunch the numbers and comments that wages and PCE are larger overall than if the Fed cuts came in July, September, or November.