Goldman says not so fast while BlackRock sees earlier Fed rate hike

[NEW YORK] Goldman Sachs Group said investors should not rush to anticipate a rate increase from the Federal Reserve after job gains beat economist forecasts. BlackRock Inc, however, said that it'll happen sooner than expected.

"Not so fast," Jan Hatzius, the chief economist at Goldman Sachs in New York, wrote in a report dated Oct 5. Labour market slack will help keep the Fed from raising borrowing costs until the third quarter of next year, according to Mr Hatzius. Goldman, which gets the largest share of revenue from trading among US banks, is one of the 22 primary dealers that trade directly with the US central bank.

"The Fed's going to move faster than people think," BlackRock's chief investment officer for fundamental fixed income Rick Rieder said on Oct 3, reiterating an earlier view. "We have an economy today that's going, we think, quite strong," he said on Bloomberg Television's Market Makers. The company's US$4.32 trillion in assets make it the world's biggest money manager.