Goldman Sachs abandoned its forecast for the Federal Reserve to hold rates through 2026, now expecting a 25-basis-point increase at the FOMC meeting concluding on September 16. The shift came after August's core consumer price index rose 0.3% month-on-month, exceeding the 0.2% consensus forecast.
Chief U.S. economist David Mericle and other Goldman researchers cited the stronger inflation print as the reason for the policy reversal. The bank had previously argued in late July that rates would remain unchanged through year-end. JPMorgan, Citigroup, Mitsubishi UFJ, and TD Securities have reached the same conclusion regarding a September rate increase.
Market pricing shifted sharply following the CPI release. CME Fedwatch odds for a quarter-point increase climbed from approximately 69% to 86.5% by day's end, with broader market pricing subsequently drifting toward 90%.
Bitcoin Technical Action
Bitcoin's 50-day exponential moving average briefly crossed above its 200-day line on September 11—a technical pattern traders call a golden cross—before slipping back beneath it by close of trading. The intraday high reached $79,505 before the price retreated to a range around $77,200.
Bitcoin has repeatedly failed to break above the $80,000 level throughout the month, with each failure coinciding with hawkish repricing of rate expectations. The four-hour chart has maintained a golden cross since late August, though the daily confirmation signal did not hold. Trend strength remains firm on the daily timeframe with an average directional index reading of 45.
Looking Ahead
Market participants have largely priced in the September rate increase. The more consequential question is the Federal Reserve's signaling about the path forward—whether officials view the 25-basis-point increase as a one-time move or the beginning of a series of hikes. A signal of multiple future increases would likely pressure risk assets including bitcoin further.
