Expects the impact of rising oil prices to be temporary, estimating a drag of less than 0.05 percentage points on U.S. GDP.

Assuming no sustained disruption to shipping through the Strait of Hormuz, the bank still expects Brent crude and WTI crude to fall to $60 per barrel and $65 per barrel, respectively, in the fourth quarter of this year, although risks are tilted to the upside.

According to a research report released by Goldman Sachs on the Zhitong Finance app, it is estimated that for every 10-dollar increase per barrel in oil prices, the quarter-on-quarter growth of U.S. Gross Domestic Product (GDP) in the fourth quarter of this year will decrease by approximately 0.1 percentage points. This reflects the drag on consumption caused by a decline in real disposable income, partially offset by an increase in energy capital expenditure. However, the bank anticipates that such disruptions should be temporary, with the negative impact on U.S. GDP being less than 0.05 percentage points.

In terms of inflation, every 10% increase in oil prices will raise the U.S. core Consumer Price Index (CPI) by 4 basis points and the overall CPI by 28 basis points. Under the baseline scenario, the bank expects the year-over-year increase in the overall CPI to rise from 2.4% in January this year to 2.7% in May, before retreating to 2% in December. Assuming a prolonged period of rising oil prices, the overall CPI could reach 3% in May and remain elevated until September.

Assuming no sustained disruption to shipping through the Strait of Hormuz, the bank still expects Brent crude and WTI crude to fall to $60 per barrel and $65 per barrel, respectively, in the fourth quarter of this year, although risks are tilted to the upside.