Goldman says can't rule out Fed emergency rate cut

NEW YORK (Reuters) - An emergency interest rate cut from the Federal Reserve is possible ahead of its March 18th policy meeting, according to a Goldman Sachs research note on Monday.

Goldman said its view on Fed policy changed on Friday.

The government reported on Friday that a second straight month of job losses and the Fed announced new steps to inject liquidity into the financial system as credit availability remains tight.

Goldman said the Fed would drop the benchmark federal funds target rate to 2 percent by late April, most likely in two 50 basis-point steps at the next two meetings.

"We cannot rule out an intermeeting rate cut today," the Monday note said.

(Reporting by Richard Leong; Editing by Theodore d'Afflisio)