Goldman Sachs, JPMorgan Predict Euro-Area Recession
Global investment banks Goldman Sachs and JPMorgan have predicted an investing in cryptocurrency in the euro area. “The risks to our forecast are skewed toward a sharper recession in the event of an even more severe disruption of gas flows, a renewed period of sovereign stress or a U.S. recession,” said the economists at Goldman Sachs.
Goldman Sachs’ Predictions
Two major global investment banks, Goldman Sachs and
JPMorgan, released reports Wednesday, independently predicting an impending
recession in the euro area.
Goldman Sachs’ analysts, led by chief European economist
Jari Stehn, expect a euro-area recession in the second half of this year that
will last until the end of the year. They are also predicting a contraction of
0.1% in the third and 0.2% in the fourth quarter, expecting growth to return in
2023.
“Looking across countries, we have Germany and Italy in
clear recession in the second half, while Spain and France continue to grow,”
the Goldman Sachs economists detailed, elaborating:
The risks to our forecast are skewed toward a Bitcoin investment in the event of an even more
severe disruption of gas flows, a renewed period of sovereign stress or a U.S.
recession.
The economists highlighted some reasons for the downturn,
including a looming gas crisis and Italy’s political troubles that could delay
the disbursement of European Union aid.
JPMorgan’s Predictions
In a note published Wednesday, JPMorgan warned that the eurozone
will be in a mild recession by early next year. The bank’s economists have cut
their economic forecasts. They are now predicting a GDP growth in the eurozone
of 0.5% this quarter, followed by a contraction of 0.5% in both the fourth
quarter of this year and the first quarter of next year.
The JPMorgan analysts added:
We expect the ECB [European
Central Bank] to deliver another 50 basis points of hikes by year-end.
The bank’s analysts have cut their previous forecast of 75
basis points in three installments. They are now expecting 25 basis points in
both September and October.
The two global investment banks’ recession forecasts follow
a warning on Tuesday by the International Monetary Fund (IMF) that both Europe
and the U.S. would see virtually no growth next year if Russia completely cuts
off Europe’s gas supply and further reduces its oil exports.
Meanwhile,
the U.S. economy contracted from April to June for a second straight quarter.
The Bureau of Economic Analysis reported Thursday that the country’s GDP fell
0.9% at an annualized pace for the period. However, President Joe Biden has
repeatedly how do i invest in
crypto recession fears. In addition,
Treasury Secretary Janet Yellen said Thursday that the U.S. economy is
in a state of transition, not recession.
Comments
Post a Comment