synopsis

Solomon also noted that policy actions to date have raised the level of uncertainty to a degree that isn’t healthy for investment and growth.

Goldman Sachs Group Inc. (GS) CEO David Solomon reportedly said that capital activity will slow down if uncertainty increases from current levels, but also expressed hope that markets might settle down.

“If the level of uncertainty grows from here, yes, you will not see the same amount of capital activity — but things will settle down,” Solomon said in an interview with Bloomberg Television on Tuesday. “People need to transact, need to raise capital, need liquidity for their investments. Part of this is just a reset of expectations.”

The Goldman CEO also pointed out that the current policies have driven the uncertainty to unhealthy levels. “The policy actions to date have raised the level of uncertainty to a degree I do not think is healthy for investment and growth,” said Solomon, according to the Bloomberg report.

Goldman Sachs’ first-quarter earnings had topped Wall Street estimates. Earnings per share (EPS) stood at $14.12 compared to a Street estimate of $12.28. The lender reported a 17% jump in net income to $4.58 billion during the quarter.

Net revenues in the Global Banking & Markets division rose 10% to $10.71 billion for the first quarter of 2025.

However, Investment Banking fees fell 8% to $1.91 billion. This was due to significantly lower net revenues from its Advisory segment compared with a strong prior year period, partially offset by higher net revenues in Debt Underwriting, primarily driven by asset-backed and investment-grade activity.

Meanwhile, Solomon also cautioned that layoffs may increase as corporate executives prioritize expense management this year. “As I am talking to CEOs, talking to our clients, they are holding back on investment and they are certainly tightening their belts,” he added.

Solomon’s comments come at a time when the Federal Reserve is tackling the possibility of a spike in inflation due to the Trump administration’s tariff policies, along with the possibility of a recession.

Investors and traders are now watching the PCE inflation data, scheduled for release on Wednesday, to gain further insight into the Federal Reserve’s monetary policy actions.

GS stock traded 0.59% higher on Tuesday. The stock has lost over 4% in 2025 but is up more than 27% over the past 12 months.

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