Goldman Sachs: Non-farm payrolls better than expected, Friday's CPI may unexpectedly rise causing the Federal Reserve to turn hawkish.

Goldman Sachs Asset Management analyst Kay Haigh stated that there are some preliminary signs of tightening in the labor market, but there is still a long way to go before it fully tightens. Given the continued strong economic performance exceeding expectations, the focus of the FOMC will shift towards the inflation situation. We still believe that the Federal Reserve has room for two interest rate cuts this year; however, if the CPI released on Friday unexpectedly increases, it may cause the Federal Reserve to lean towards a more hawkish direction.