Probability of U.S. Recession Lowered from 35% to 30%
GDP Growth Forecast Raised from 1% to 1.25%
Reflecting Expectations for U.S.-China Trade Agreement
On June 12 (local time), U.S. investment bank Goldman Sachs (IB) lowered the probability of a U.S. economic recession within the next 12 months from the previous 35% to 30%. This adjustment was made due to a partial easing of uncertainty surrounding U.S. tariff policy following the 'trade agreement' between the United States and China.
According to TradingView, Goldman Sachs reduced the probability of a U.S. recession from 35% to 30% to reflect the easing of U.S.-China trade tensions and the slowdown in inflation. The bank also raised its forecast for U.S. gross domestic product (GDP) growth over the next 12 months from 1.00% to 1.25%.
Previously, the United States and China agreed on a framework for implementing the first-round agreement during the second round of trade negotiations held in London from June 9 to 10.
U.S. President Donald Trump (left) and Chinese President Xi Jinping are shaking hands at the U.S.-China summit during Trump's first term in 2018.
Although the specific details of the agreement have not been disclosed, U.S. President Donald Trump announced on June 11 that, during the second round of U.S.-China trade negotiations, the two countries had reached agreements regarding China's supply of rare earths to the United States and the acceptance of Chinese students in the U.S.
On June 11, the U.S. Department of Labor announced that consumer prices in May did not rise as much as previously feared, despite concerns over tariff policy. However, the impact of tariffs on prices is expected to become more pronounced over time.
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