Catenaa, Monday, April 07, 2025- Goldman Sachs has raised its US recession forecast to 35%, up from 20%, citing economic uncertainty fueled by former President Donald Trump’s proposed tariffs.
The bank’s revised outlook aligns with warnings from Moody’s Analytics Chief Economist Mark Zandi, who described the situation as a “trade war” with escalating consequences.
Major trading partners, including China, Canada and European nations, are retaliating with tariffs on US goods.
The prolonged dispute has already impacted consumer spending, travel, and stock market confidence, according to Zandi.
He warned that if businesses begin laying off workers, recession risks will grow further.
Zandi also cautioned that tariffs could lead to long-term economic damage by disrupting supply chains and reducing productivity growth. While the Trump administration argues that tariff-related economic pain will be short-lived, analysts remain skeptical.
The next steps depend on whether the administration adjusts its trade policies. If the tariffs are broad and persistent, economists warn, the likelihood of a recession in late 2025 will continue to increase.
