- Bloomberg Economics sees near certainty downturn will start
- Tightening conditions, inflation, and hawkish FED weigh on outlook
- Fitch is predicting a US recession in the spring
A US recession is effectively certain in the next 12 months in the new Bloomberg Economics model projections, a blow to President Biden’s economic messaging ahead of the November midterms.
The latest recession probability models forecast a higher recession probability across all timeframes, with the estimate of a recession hitting within the next 12 months rising from 65% to 100% for the comparable period.
Forecasts for 2023 are increasingly gloomy. Economists now expect GDP to contract in the first two quarters of next year, a downgrade from the last quarterly survey, whereby they penciled in mild growth.
Forecasters have ratcheted up their expectations for a recession because they increasingly doubt the Fed can keep raising rates to cool inflation without inducing higher unemployment and an economic downturn. Some 58.9% of economists said they think the Fed will raise interest rates too much and cause unnecessary economic weakness, up from 45.6% in July.
JPMorgan Chase CEO Jamie Dimon warned that a “very, very serious” mix of headwinds was likely to tip both the U.S. and global economy into recession by the middle of next year. Asked for his views on the outlook for the S&P 500, Dimon said the benchmark could yet fall by “another easy 20%” from current levels, adding that “the next 20% would be much more painful than the first.”
Most Americans have not yet adjusted their asset allocation to adequately hedge against a potential economic downturn. When a recession is looming, it’s a good time to buy gold . Gold prices tend to increase when stock markets tank. But if you buy gold before that happens, you can purchase it at a lower price for a solid return on investment.
You can get started easily by downloading our Free Investment Kit on Gold, Silver & Precious Metals IRAs . If you would like to get in touch to speak to a specialist then call (800) 757-7050 and we will send the most relevant information out to fit your needs.
