Chances that the U.S. is heading for a recession are close to 50-50, according to a Deutsche Bank survey that raises more questions about the direction of the U.S. economy.
The probability of a downturn in growth over the next 12 months is about 43%, as set by the average view of 400 respondents during the period of March 17-20.
Though unemployment remains low and most data points suggest continuing if not slowing growth, the survey results reinforce the message from sentiment surveys that consumers and business leaders are increasingly concerned that a slowdown or recession is a growing risk.
Federal Reserve Chair Jerome Powell last week acknowledged the worries but said he still sees the economy as âstrong overallâ featuring âsignificant progress toward our goals over the past two years.â
Still, Powell and his colleagues at the two-day policy meeting that concluded Wednesday lowered their estimate for gross domestic product this year to just a 1.7% annualized gain. Excluding the Covid-induced retrenchment in 2020, that would be the worst growth rate since 2011.
Additionally, Fed officials raised their outlook for core inflation to 2.8%, well above the central bankâs 2% goal, though they still expect to achieve that level by 2027.
