Goldman Sachs now expects Fed to hike rates in September

Goldman Sachs has revised its view and now anticipates a 25 basis point increase in the Federal Reserve's benchmark rate when its September policy meeting takes place. Earlier, the bank had projected that borrowing costs would hold steady, so this represents a complete change of direction in its forecast.

According to Business Recorder, the forecast change came in a note released on Friday, and the bank said it was driven more by pricing in financial markets than by its economic outlook. Investors have broadly come to anticipate a rate rise, which the bank cited as the main reason for updating its call. Put simply, the revision reflects what markets already price in rather than a fresh reading of economic conditions.