Goldman Sachs CEO David Solomon gave his most optimistic assessment of the US economy in years at the firm's annual investor conference, declaring that the Federal Reserve successfully executed the soft landing that most economists thought impossible: bringing inflation from 9.1% down to 2% without triggering a recession or meaningfully increasing unemployment.
"History will record this as the finest execution of monetary policy since Volcker broke inflation in the 1980s," Solomon said. "Jerome Powell made the right calls at the right times, and the American economy is stronger for it."
The macroeconomic data supports his assessment. US GDP has grown for 10 consecutive quarters. The unemployment rate is 3.9% β essentially full employment by any measure. Wage growth has outpaced inflation for four consecutive quarters, meaning American workers are finally gaining real purchasing power after three years of inflation erosion.
Goldman has raised its 2025 US GDP growth forecast to 2.8%, above consensus. The bank expects the consumer spending that drives 70% of the US economy to remain healthy, supported by a strong labor market, rising home equity, and the wealth effect from record equity prices.
"The biggest risk is that investors and policymakers get complacent," Solomon cautioned. "The US economy is performing well. The job now is not to mess it up."
