Jpmorgan Chase & Co. said It expects the American economy to be stagnated this year after it represents the potential impact of the definitions announced by the Trump administration this week.
“We are now expecting the real GDP to decrease the weight of definitions, and for the full year (fourth/fourth quarter), we are now looking for real growth by -0.3 %, decreasing from 1.3 % before,” Michael Feli said on Friday, referring to the total local products.
“It is expected that the expected contraction in economic activity will lead to a decrease in employment and over time to raise the unemployment rate to 5.3 %,” said Feli.
On Wednesday, President Donald Trump’s announcement of the main customs tariff for American commercial partners around the world has sent the S&P 500 from American stocks to its lowest level in 11 months,Wipe 5.4 trillion dollarsThe market value in two trading sessions only to close the week.
Read more:The worst collapse of stocks since Covid deepened with high recession possibilities
Jpmorgan’s expectations came alongside similar changes from other banks, which reduced expectations for American growth this year since the declaration of customs tariffs. Thursday , Barclays Plc said thatThe gross domestic product is expected to contractIn 2025, “consistent with stagnation.”
On Friday, economists in City reduced their expectations for this year to 0.1 %, and economists in UBS decreased to 0.4 %.
“We expect the US imports to decrease from the rest of the world by more than 20 % on our expected horizon, most of them in the next many quarters, making imports as a share of GDP to pre -1986 levels,” Jonathan Bingan, UBS chief economist at UBS. “The power of trade policy has a major amendment to the total economy of a $ 30 trillion economy.”
“Standardization”
Feroli said it is expected that the Federal Reserve will start reducing the standard interest rate in June and moving forward with price discounts at each subsequent meeting until January, making the standard in a range of 2.75 % to 3 % of the current 4.25 % range to 4.5 %.
These discounts will come despite an increase in a main scale of basic inflation to 4.4 % by the end of the year, from the current level of 2.8 %.
Read more:Powell says that the Federal Reserve was not in a rush to cut the markets with continued lighting
“If you realize, our stagnation expectations will provide a dilemma for political makers that feed it,” Feli wrote. “We believe that the physical weakness in the labor market is in the end, especially if it leads to poor wages, which gives the committee more confidence in the price of the price does not leak.”
On Friday, Federal Reserve Chairman Jerome Powell said, “It seems that we do not need to be in a hurry” to make any price amendments. His comments were followed by issuing the latest monthly employment report from the Labor Statistics Office, whichShow strong employmentIn March, along with a slight rise in the unemployment rate, to 4.2 %.
Investors are betting on a full percentage of discounts by the end of the year, according to futures contracts.
This story was originally shown on Fortune.com
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