SINGAPORE: Goldman Sachs has raised the odds of a US recession to 45% in the next 12 months, joining other investment banks in revising their forecast as fears of a trade war grip markets after sweeping tariffs from US President Donald Trump.
Goldman raised the probably of a recession in the next 12 months from a previous estimate of 35% following a sharp tightening in financial conditions and a rise in policy uncertainty that is likely to depress capital spending by more than what Goldman had previously assumed.
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Several investment banks raised their recession risk forecasts last week, with J.P. Morgan putting the odds of a US and global recession at 60%.
Goldman had raised the probability of a US recession to 35% from 20% just last month, noting economic fundamentals were not as strong as in the previous years.
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