Rising inflation and recent dips in U.S. stock markets have caused some experts to forecast a recession for the U.S., reports Investment Monitor.
The U.S. economy shrank by 1.4% in the first quarter of this year, and rapidly rising interest rates have prompted concern that an economic downturn is around the corner. But banks are divided over the likelihood of a recession: Wells Fargo and Deutsche Bank expect a recession this year, while Goldman Sachs, Morgan Stanley, and the New York Reserve put the odds of a downturn at 25% or lower.
Decades-high inflation has reduced consumer confidence to its lowest point since 2011, with the majority of Americans (52%) reporting that they’re in greater financial distress now than last year. U.S. businesses also report lower confidence in the future, with over a quarter of business owners (29%) expecting a decrease in business activity.