Goldman Sachs Pares Risk Post Trump's Liberation Day Tariffs: President John Waldron Calls It A 'Sensible' Move

Goldman Sachs President John Waldron said on Thursday that the bank has trimmed its risk exposure after President Donald Trump’s ‘Liberation Day’ tariffs were announced on April 2.

Waldron said in a podcast that Goldman Sachs is absorbing a “lot of risk” from its clients, but wherever possible, it is paring risks and staying “a bit closer to home.”

“We have moderated our risk positioning since April 2nd – I think that's a sensible thing for us to do,” Waldron said.

He also added that the bank is gearing up for uncertainty while keeping liquidity ready for deployment when the time is right.

Despite the uncertainty, Federal Reserve’s Raphael Bostic said the U.S. labor market has been strong and so has consumer spending. This gives him the confidence that there won’t be a recession, he said.

The one overhang for equity markets, though, is the question of interest rates. The Federal Reserve is likely to keep interest rates steady at the upcoming policy meeting.

"We're seeing a lot of increase in duration in the rate curves in the United States and Japan and many other countries - and I think that could be a brake on economic growth," he said.

Muddying the waters for the central bank is the Trump administration’s tariff policy – Federal Reserve Governor Lisa Cook said Trump’s tariffs could reverse the course on inflation, which could make it difficult for the central bank to cut rates.

Like many of her peers, Cook also maintained that the Fed’s wait-and-watch policy best suits the current uncertainty in the U.S. economy.

Meanwhile, the SPDR S&P 500 ETF (SPY), which represents the S&P 500 index, was up 0.03% at the time of writing.

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Also See: US Trade Deficit Narrows Significantly In April On Largest-Ever Decline In Imports Due To Trump Tariffs

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