The Press Stories
Goldman Sachs Predicts Only 15% Chance of US Recession in the Next Year
Goldman Sachs, a renowned investment banking firm, has recently revised its estimated probability of a US recession to a mere 15% for the next 12 months. In a report released by the bank, several positive economic indicators were highlighted, including the inflation rate and the buoyant job market.
Contrary to prevailing concerns, Goldman Sachs disagrees with the notion that the country’s monetary policies will drive the economy into a recession. The bank firmly believes that the Federal Reserve, the country’s central banking system, has finished raising interest rates and is not expected to make any further increases.
This revision demonstrates Wall Street economists’ repeated revisions of their recession forecasts, indicating the economy’s resilience. Goldman Sachs, in particular, is reportedly “substantially more optimistic” than other forecasters who predict a 60% chance of recession.
However, the report also indicates that GDP tracking tools may possibly overstate the true momentum of the US economy. Although job growth has been consistently solid and wages are on the rise, there are concerns that these indicators might not accurately reflect the overall economic performance.
Despite these concerns, Goldman Sachs remains optimistic, citing job growth and rising wages as factors that will support an increase in real disposable income in the coming year. Consumer spending, which plays a crucial role in economic growth, is expected to benefit from these positive dynamics.
Furthermore, the August jobs report showcased solid hiring figures; however, the unemployment rate slightly increased due to more individuals actively searching for work. This indicates a robust job market and highlights the overall strength of the US economy.
As the US economy continues to show resilience, Goldman Sachs’ revised estimates create a sense of optimism among investors and the general public. With the bank’s unwavering confidence in the future outlook, it is likely that other institutions will also revise their recession forecasts and contribute to a more positive narrative surrounding the US economy.
