Goldman's Hatzius: Start pricing in March rate hike

Investors should expect a second Federal Reserve rate hike in March, Goldman Sachs Chief Economist Jan Hatzius said Friday.

"March should be priced higher than it is. I don't think it's a done deal, but my expectation would be that they do go in March," he told CNBC's "Squawk on the Street."

Hatzius made his remarks after the release of a better-than-expected jobs report.

The Bureau of Labor Statistics said Friday the U.S. economy added 211,000 jobs in November, above the expected 200,000, giving the Fed more ammunition to justify hiking rates for the first time in nearly a decade.

The probability of a central bank rate increase remained at 79 percent after the release of the report, according to the CME Group's FedWatch tool.

Regarding the first rate hike, Hatzius said, "I think they will want to make the hike as palatable as possible, but I think there's a limit to it because they don't want to box themselves in too much."

"The expectation is still going to be that they are going to go something like once a quarter."