Expectations of a recession in America within 12 months rise to a historical level

The percentage of economists who expect a recession in the United States in the next 12 months rose to a historical level of 44%, in a Wall Street Journal poll, compared to 28% in April and 18% in January.

The newspaper stated that this is the first time that expectations have come to such a high rate in the pre-recession periods, since it began conducting the poll in mid-2005.

Economists’ expectations increased due to several factors, such as rising borrowing costs, sharp inflation, supply chain problems and commodity shocks caused by the Russia-Ukraine war.

In the same context, economists at Nomura Holdings Financial Group said that the US economy is likely to witness a slight recession in the fourth quarter of this year, in light of the US Federal Reserve raising interest rates to curb inflation.

Nomura economists expected that both excess savings and strong household budgets would contribute to mitigating the speed of the economic downturn, noting that monetary policy would be constrained by high inflation.

Nomura cut its forecast for GDP growth this year to 1.8% from 2.5% previously, and 1% in 2023 from 1.3% previously.

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