Goldman Sachs still sees 25 basis point Fed cut next week

(Reuters) – Goldman Sachs on Friday said it continues to call for a quarter percentage point easing at next week’s Federal Open Market Committee meeting, which contrasted with news stories about refreshed speculation of a more aggressive cut.

Former New York Federal Reserve President Bill Dudley said on Thursday there was a strong case for a 50-basis-point interest rate cut at the Fed’s Sept. 17-18 rate-setting meeting.

Investors on Friday reacted to news articles in the Financial Times and the Wall Street Journal, which highlighted that the size of the first cut could be a close call for Fed officials, triggering speculation of a larger cut.