David Mericle, a Goldman Sachs economist, predicted that the Federal Reserve would not raise interest rates this week due to bank system stress. This was published in a Monday morning note. In a note to clients, he stated that “while policymakers have responded vigorously to shore-up the financial system,” and that markets are less than convinced that efforts to support small or midsize banks will be sufficient. Mericle stated that the link between future inflation and a quarter-point increase in the Fed’s interest rate is “very tenuous”, and that the Fed could quickly get back to normal with increases. Quarter-point increases are still expected by the bank in May, June, and July. The yield on the 2-year Treasury declined 6 basis points to 3.777%.