Goldman Sachs cuts U.S. GDP forecast after banking crisis
Reuters
Published Mar 15, 2023 01:03PM ET
(Reuters) - Goldman Sachs (NYSE:GS) on Wednesday lowered its forecast for fourth-quarter U.S. gross domestic product (GDP) growth, citing risks to the lending environment as smaller banks pull back on loans to preserve liquidity in the face of a banking crisis.
Analysts at the firm now expect year-over-year growth of 1.2% for the quarter, down 0.3 percentage points from their previous estimate.
Regional banks in the United States have been on a bumpy ride since SVB Financial Group was shuttered by regulators after a bank run last week.
The rapid unraveling of the startup lender has fueled worries of potential bank runs at peers that could leave them scrambling for funds to meet deposit withdrawal requests.
Goldman Sachs said stress at some banks persists despite federal agencies having acted aggressively to bolster the financial system.
On Tuesday, ratings agency Moody's (NYSE:MCO) revised its outlook on the U.S. banking system to "negative" from "stable".
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Written By: Reuters
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