The US economic landscape is once again buzzing with talk of a recession. This makes investors around the world feel nervous. Although experts are reassuring market participants that the situation is quite stable, investors remain skeptical.
Sergio Ermotti, CEO of UBS, the largest Swiss bank by capitalization, said that it was too early to talk about the US economy slipping into a recession. He explains that a recession is characterized by a sustained decline in domestic production or a consistent drop in GDP growth rates. However, such signs are not currently visible.
The expert is confident that there are no conditions for a recession at the moment. “The macroeconomic indicators are not clear enough to talk about recessions, and actually, it’s probably premature," he said.
Furthermore, the Federal Reserve has plenty of tools to stabilize the domestic market, and it is possible that the regulator will use them soon. UBS currency strategists believe that by the end of 2024, the US central bank will lower the key interest rate by at least 50 basis points.
However, in the second half of 2025, volatility in the US stock market could increase significantly. According to Ermotti, this trend could be influenced by many factors, including rising geopolitical tensions and worsening macroeconomic conditions in the US.
Earlier, experts at JPMorgan Chase, one of the world’s largest banks, stated that there was a high probability of the US economy slipping into a recession by the end of 2024. Analysts estimate that this probability will increase from 25% to 35%. JPMorgan Chase also considers the possibility of a negative scenario that includes a sustained slowdown in US GDP growth in the second half of 2025. Bank specialists estimate the likelihood of this scenario at 45%.
