Leading global investment bank Goldman Sachs has updated its US recession prediction. The forecast has gone from bad to worse indicating that the US markets could crash similar to the 2008 financial crisis. The Goldman Sachs prediction comes at a time when the BRICS alliance is looking to bring the US economy down.
Also Read: BRICS: Idea of De-Dollarization Is ‘Non Sense’: Analyst
Goldman Sachs has increased its recession risk from 15% to 25% for the US economy and stock market. That’s a sharp increase indicating that the worst is yet to come for the US economy. If a recession hits the US, the jobs market will be the first to experience a major decline. Since BRICS is looking to cut ties with the US dollar, their economies could remain safe and be recession-free.
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Read here to know how many sectors in the US will be affected if BRICS ditches the dollar for trade. “We continue to see recession risk as limited,” Goldman Sachs economists led by Jan Hatzius said in a report. “If we are wrong and the August employment report is as weak as the July report, than a 50bp cut would be likely in September,” they wrote to their clients.
BRIS: Goldman Sachs on US Recession in 2024
Investment bank Goldman Sachs predicted that the markets could recover only if job growth spikes by the end of 2024 and could limit the rise of the BRICS de-dollarization agenda. If jobs fail to catch up in the US, BRICS could try to overtake the US in terms of job creation. “The premise of our forecast is that job growth will recover in August and the FOMC will judge 25bp cuts a sufficient response to any downside risks,” the Goldman Sachs economists said. “If we are wrong and the August employment report is as weak as the July report, than a 50bp cut would be likely in September.”
Also Read: BRICS: UBS Predicts the Future of the U.S. Dollar