Goldman Sachs expects no more interest rate hikes starting in September 2023, which could be a catalyst for higher Bitcoin prices.

As the Fed's battle with inflation continues, Goldman Sachs analysts expect the FOMC to stop raising interest rates next month in September. However, after this, interest rates are likely to fall, which would be positive for the stock, Bitcoin, and crypto markets in general.

Stocks and the broader cryptocurrency market have enjoyed a strong rebound in 2023 so far. The tech-heavy Nasdaq Composite Index (INDEXNASDAQ: .IXIC) is up 31%, while Bitcoin (BTC) prices are up 77%. So far.

Goldman Sachs analysts expect the Fed to start cutting interest rates starting in June 2024. They also expect quarterly rate cuts thereafter.

"We expect the funds rate to normalize from restrictive levels once inflation approaches target, so we revise our forecasts downward," Goldman economists including Jan Hatzius and David Mericle wrote in a note on Sunday.

Currently, the Goldman team predicts that rate cuts could begin around mid-2024. The committee responsible for setting those rates, called the Federal Open Market Committee, is expected to decide next month not to raise rates. By the time of their November meeting, they may agree that the pace of price increases has slowed enough to avoid further rate hikes. Goldman analysts wrote:

"Normalization is not a particularly pressing motivation for rate cuts, so we also see a significant risk that the FOMC will hold steady. We expect 25 basis points of rate cuts per quarter, but are unsure of the pace."

Will Bitcoin prices rise after September?

The Bitcoin price has been hovering above $29,000 for the past few weeks and has not found enough ammunition for further price action. However, Bitcoin whales and retail addresses continue to accumulate as new Bitcoin network addresses join.

Bitcoin’s support around $29,200 remains firm and its technical condition has not changed. Currently, BTC is trading with no clear upside or downside trend as it struggles to rise above $29,600 in four hours.

If Bitcoin succeeds in breaking above the $29,600 level in a bullish move, it could potentially climb to around $30,200. If Bitcoin price succeeds in overcoming the $30,2000 resistance, it could further rise to $30,600 to $31,000.