--- title: "Interest-Rate Cut Expectations Pushed Back Again; Goldman Sachs: AI-Driven Productivity Improvement Is the Key Macro Variable" type: "News" locale: "en" url: "https://longbridge.com/en/news/286799101.md" description: "Goldman Sachs has pushed back its interest-rate cut expectations to December, acknowledging that rising long-end yields and inflationary pressures have induced market caution. However, the firm emphasizes that the most critical macro variable at present is not the short-term interest rate path, but AI-driven productivity gains—U.S. Labor Productivity has risen from 1.5% to 2.1%, driving a restructuring of long-term earnings expectations and providing effective support for valuations" datetime: "2026-05-18T16:30:41.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/286799101.md) - [en](https://longbridge.com/en/news/286799101.md) - [zh-HK](https://longbridge.com/zh-HK/news/286799101.md) --- # Interest-Rate Cut Expectations Pushed Back Again; Goldman Sachs: AI-Driven Productivity Improvement Is the Key Macro Variable Long-end yields breaking through key resistance levels, Inflation Expectations resurging, momentum indicators touching extreme levels not seen since 2000, and significantly narrowing market breadth—multiple signals are causing some U.S. equity investors to turn cautious. In the face of market concerns, Goldman Sachs did not shy away from macro-level pressures—the firm **pushed back the timing of Interest-Rate Cuts within the year** in its latest outlook. However, Goldman Sachs also stated that **the core variable currently supporting the market is not the short-term interest rate path, but rather AI-driven productivity improvements and the resulting restructuring of long-term earnings expectations.** Jan Hatzius, Chief Economist at Goldman Sachs, pointed out in the latest monthly report that the growth rate of U.S. Labor Productivity has risen from the pre-pandemic long-term trend level of approximately 1.5% to 2.1%. He expects this upward trend to continue as AI technology accelerates its penetration across various industries. Mark Wilson, a Partner at Goldman Sachs, stated that although the recent rise in long-term Treasury yields and the postponement of Interest-Rate Cut expectations have put some pressure on the market, over a longer cycle, **productivity improvements driven by AI and the boost to corporate earnings prospects remain the most critical macro variables determining stock market trends. Although semiconductor and AI-related sectors have seen astonishing gains, the broader market has not truly entered a stage of irrational exuberance.** ## Interest-Rate Cuts Delayed, But AI Supports the Market **Goldman Sachs has further pushed back expectations for Interest-Rate Cuts, predicting that the Federal Reserve's first rate cut may occur in December this year, with the second potentially delayed until March next year.** Meanwhile, rising energy prices, tightening supply of memory chips, coupled with continued expansion of global fiscal spending, have jointly driven up long-term Treasury yields in the U.S. and globally. The yield on the U.S. 10-year Treasury note has once again approached key resistance levels, while yields on UK and German government bonds have also risen in tandem. From a traditional logic perspective, rising interest rates usually suppress high-valuation growth stocks. However, market performance has not shown significant instability. Semiconductors and other tech stocks have remained at high levels after a substantial surge in April, and space-related concept stocks have even recorded gains close to double digits. The reason the market can withstand a higher interest rate environment lies in the fact that investors are repricing their expectations for future earnings. **And the core driver of this revaluation is precisely the productivity transformation brought about by AI.** ## Long-Term Earnings Revaluation: AI Is More Than Just a Concept Jan Hatzius, Chief Economist at Goldman Sachs, pointed out that approximately 75% of the fundamental value in current U.S. stock valuations comes from earnings and dividends ten years or more into the future. Therefore, **as long as AI continues to drive productivity improvements, expectations for long-term corporate profit growth are likely to be revised upward, thereby providing effective support for valuations.** Mark Wilson, a Partner at Goldman Sachs, provided corroborating evidence from a historical perspective. He reviewed the case of Amazon's 29th anniversary since its listing: its IPO price in 1997, adjusted for stock splits, was only $0.075, and it has cumulatively risen more than 3,500 times as of last Friday's close. While the internet era was accompanied by significant capital misallocation and failed projects, the returns created by a few long-term winners were sufficient to cover the vast majority of investment losses. Wilson believes that the current AI cycle shares similar characteristics. **Although capital waste is inevitable, tech giants are investing record amounts of capital expenditure into AI infrastructure construction—investments supported by internal cash flows are continuously opening up new growth spaces. The few industry leaders that ultimately emerge are expected to drive a long-term value revaluation across the entire market.** While maintaining a constructive view, Goldman Sachs also acknowledged that some market indicators have approached extreme levels. 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