Goldman Sachs Sees 65% Chance Of US Recession In Next 12 Months

Goldman Sachs Group Inc. economists said they now see a 65% chance of a US recession in the next 12 months, citing President Donald Trump’s tariffs on US trading partners.

“We think the White House is unlikely to quickly reverse most of the new tariffs, but our probability of recession would decline if it does,” Goldman Sachs economists led by Jan Hatzius said Wednesday in a note. It was emailed to clients just as Trump announced a 90-day pause on implementation of most tariffs, which sent stocks soaring.

The new forecast includes a 1% decline in gross domestic product in 2025 and a rise in the unemployment rate to 5.7%. It follows similar projections by economists at other Wall Street firms in recent days, including JPMorgan Chase & Co.

“This would be less severe than most past US recessions, in part because we do not see major financial imbalances that need to unwind, private sector balance sheets remain strong, and we see some room for trade deals to eventually lower tariff rates somewhat,” Hatzius wrote.