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Goldman Sachs CEO: Inflation is entrenched in global economy |

by WOOWinvest
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Goldman Sachs CEO: Inflation is entrenched in global economy |

Goldman Sachs Chief Executive David Solomon said at the second-quarter earnings call on Monday (18th) that inflation is “entrenched” in the global economy and it is still unclear whether conditions will improve later this year, while noting that both supply and demand are affected by the epidemic. With the impact of the war, companies are suffering from supply chain inflation.

Solomon told analysts: “We see that inflation is deeply embedded in the economy, and what is unusual about this particular period is that both demand and supply are affected by external events, namely the new crown epidemic and the Russian-Ukrainian conflict. “

Solomon said in conversations with the CEOs of large global companies, they all said supply chain inflation continued. Solomon also mentioned that his company’s economists believe that the inflation rate may decline in the second half of this year, but the answer is still uncertain and requires continuous observation.

Solomon believes that already volatile markets across asset classes will continue to oscillate as central banks around the world continue to tighten financial conditions to combat inflation. His biggest worry right now is that the central bank’s actions to fight inflation will start to take a toll on “business confidence and consumer activity.” All company resources will be carefully managed.

Goldman Sachs chief financial officer Denis Coleman said the uncertainty has made Solomon’s business strategy more cautious, and the company has now adopted a strategy of slowing talent acquisition and cutting expenses.

Goldman Sachs released its second-quarter earnings before the market, boosted by bond trading revenue, outperforming market analysts’ expectations, driving the stock up 3% before the market.

According to the financial report data, Goldman Sachs’ second-quarter net revenue was reported at US$11.86 billion, a year-on-year decrease of 22.9%, but it still exceeded market expectations of US$10.67 billion; net profit was reported at US$2.93 billion, a year-on-year decrease of 47%, and earnings per share were reported at US$7.73 , again beating market estimates of $6.65.

At the time of writing, Goldman Sachs (GS-US) shares rose 2.6% in intraday trading, at $301.52 per share.

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