Fed's Rate Hike Pause Decision Remains Unclear Despite Speculations

Goldman Sachs Economics believes that a pause in interest rate hikes is the baseline for the Federal Open Market Committee (FOMC) following Chair Powell's comments on the labor market and recession risk. Powell's statement that he does not expect a recession and believes a soft landing is possible is seen as dovish, indicating reluctance to deliver future hikes that could push the economy into a recession. Goldman Sachs also notes that Powell's emphasis on the removal of earlier guidance being a "meaningful change" supports their call for a pause in June.