Inflation exceeded expectations for the third consecutive time, and Goldman Sachs raised its forecast for Federal Reserve rate hikes.

Goldman Sachs said Tuesday it expects the Federal Reserve to deliver a third 25-basis-point rate hike in March 2027, after October CPI came in above expectations for a third consecutive month. The bank continues to forecast a second 25-basis-point hike in December, following the first increase in September 2026, and said the third hike could be pulled forward to January 2027, though it sees March as slightly more likely. Goldman attributed the timing to its expectation that November and December inflation data will cool, before customary large price increases at the start of the year push inflation back up in January 2027. The call matters because it signals persistent cost pressures are extending the Fed's tightening cycle beyond what markets had anticipated. Investors should watch the upcoming November and December CPI prints, which Goldman expects to moderate, and any early-year price resets that could bring the third hike forward.