JPMorgan Chase has raised the probability of the U.S. economy falling into recession by the end of the year to 35%
PANews reported on August 8 that JPMorgan now believes there is a 35% chance of the U.S. economy falling into recession by the end of this year, up from 25% at the beginning of last month. Bruce Kasman and his team of economists at JPMorgan wrote in a report to clients on Wednesday that news from the U.S. "suggests labor demand weakness is more severe than expected, with early signs of layoffs emerging." The team maintains a 45% probability for an economic recession in the second half of 2025. "We have moderately increased our assessment of recession risk, compared to which we have made larger adjustments to our outlook for interest rates," Kasman and his colleagues wrote. JPMorgan now thinks there's only a 30% chance that the Federal Reserve and other central banks will keep interest rates high long term, down from a predicted likelihood of 50% just two months ago. As U.S inflation pressure decreases, JPMorgan predicts that the Fed will cut interest rates by 50 basis points each in September and November.
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