Goldman Sachs on Monday raised its projection for U.S. interest rates in 2025 to three-quarter-point cuts because of muted tariff effects and labor market weakness.

Goldman Sachs now expects the Federal Reserve will make its next interest rate cut in September, and not December as previously thought, as tariffs have less of an inflationary impact than earlier feared.

Goldman Sachs pulled forward its forecast for Federal Reserve interest rate cuts, and is now calling for the central bank to resume reductions in September rather than December, as the inflationary effects of tariffs “look a bit smaller” than expected.