On April 7, Goldman Sachs adjusted its expectations for the Fed's interest rate cut, believing that the Fed's further relaxation of policy is more risky if the recession hits. Goldman Sachs now expects the Fed to start a series of rate cuts in June — earlier than previously predicted in July — as part of a preventive easing cycle.

In the basic situation where the United States avoids a recession, the Fed will cut interest rates by 25 basis points three times in a row, bringing the federal funds rate to the range of 3.5%-3.75%. However, Goldman Sachs expects the Fed to adopt a more radical policy response if the economy does fall into recession, with a rate cut of about 200 basis points next year.

Given the increased likelihood of a recession, the agency’s current weighted forecast shows a total of 130 basis points in 2025, up from the previous 105 basis points. As of last Friday's closing, this outlook was basically consistent with current market expectations.