Goldman Sachs has lowered its estimate of a U.S. recession in the next 12 months to 30%, down from 35%, citing easing trade tensions following a fresh US-China negotiaitons:
a framework on tariff ratesthe lifting of Chinese export restrictions on rare earthsrenewed access for Chinese students to U.S. universities
The bank noted that financial conditions have largely returned to pre-tariff levels, and trade policy uncertainty has eased slightly. While inflation data remains limited, Goldman said the impact of tariffs on consumer prices appears milder than initially feared.
In line with this improved outlook, Goldman also raised its 2025 GDP growth forecast from 1% to 1.25% and now expects peak unemployment to top out at 4.4%.
This article was written by Eamonn Sheridan at www.forexlive.com.