Oil Prices Fall as U.S. Crude Inventories Surge and Hormuz Tensions Persist 
UK Economy Posts Surprise June Growth as World Cup and Hot Weather Lift Activity 
US Dollar Slips as Weak Retail Sales Reduce Fed Rate Hike Bets 
Gold Prices Retreat From Two-Month High as Softer Inflation Eases Fed Rate Hike Bets 
Oil Prices Slide as OPEC, IEA Cut 2026 Demand Forecasts 
European Stocks Steady as U.S.-Iran War, Euro Zone Data Keep Investors Cautious 
Barclays Warns U.S. Stock Rally May Be Detached From Fundamentals 
Trump Imposes New Tariffs on Drone Imports Over US Security Concerns 
Asian Currencies Edge Higher as Soft US Inflation Weighs on Dollar 
Gold Prices Slip From 10-Week High as Fed and Hormuz Risks Shape Outlook 
US Dollar Slips as Softer PPI Data Eases Fed Rate Hike Expectations 
Wall Street Hits Record High as Softer Inflation Data Eases Fed Rate Hike Fears 
France Inflation Rises 2.4% in July as Consumer Prices Increase 
KOSPI Rebounds 20% as Samsung, SK Hynix Lead South Korea Stock Rally 
Strait of Hormuz Shipping Near Standstill After New Vessel Attacks 
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U.S. Recession Risk Decreases Amid Job Market Gains
Goldman Sachs has reduced the probability of a U.S. recession within the next 12 months to 15%, down from 20%, after the September employment data showed robust growth. The Labor Department reported the highest job gains in six months, with unemployment falling to 3.8%.
Labor Market Narrative Shift
Goldman Sachs’ Chief U.S. Economist, Jan Hatzius, noted that the September employment report has "reset the labor market narrative," easing concerns about a rapid weakening in labor demand. The strong job gains suggest the unemployment rate is not expected to rise significantly.
Federal Reserve Rate Outlook and Market Reactions
Goldman Sachs forecasts consecutive 25 basis point cuts by the Federal Reserve, targeting a terminal rate of 3.25-3.5% by June 2025. Hatzius also indicated a reduced risk of a more aggressive 50-basis-point cut. Financial markets have increased the probability of a quarter-point rate cut in November, jumping to 71.5% following the jobs report, as per the CME Group's FedWatch tool.
Job Growth Outlook and Economic Trends
Despite some volatility in job numbers, Goldman Sachs sees no clear signs of persistent negative revisions, crediting steady job growth to strong GDP and high job openings. However, the firm cautions that October's data may be influenced by external factors, such as potential hurricanes and significant strikes, which could affect payroll figures.
Conclusion
With the economy showing resilience through strong job growth and GDP expansion, Goldman Sachs maintains an optimistic outlook on the U.S. economy, while remaining alert to possible short-term disruptions.
