The possibility of a recession in the United States has been extensively discussed for a year already. Experienced analysts have been trying to predict whether the largest economy will face a recession or not. The Wall Street Journal has also contributed to the investigation by polling 65 economists.
According to estimates, the likelihood of a recession in the next 12 months dropped by 50%. Such a positive scenario was suggested for the first time since the middle of 2022.
In July of this year, the possibility of a recession in the United States was estimated at 54%. However, in October, the situation changed a bit. The number of those who foresaw such an outcome dropped to 48%.
Such a tendency could be explained by the inflation slowdown, strong labor market figures, and a possible end to the hiking cycle by the Federal Reserve.
According to a consensus forecast, in the fourth quarter of 2023, the US GDP may advance by 2.2% on a yearly basis. The previous estimate suggested a 1% rise. Notably, almost 50% of respondents suppose that the Federal Reserve will start cutting the benchmark rate from its peaks of 5.25%–5.50% in the second quarter of 2024.
Some analysts foresee that the likelihood of a recession in the US will slide to zero soon. The fact is that it has been falling for a while already amid the growth in real personal income, which is supporting consumer demand.
Earlier, experts at HSBC Asset Management said that the US economy might slump in the fourth quarter of the year. They believe that the economy will suffer difficulties in 2024 and even longer. In addition, a domino effect may cause a recession in Europe.
