JP Morgan sees US slipping into recession in second half of 2023
According to a report by JP Morgan, the US market is not pricing the recession and their base case predicts that there may be a hard landing in the US market. The intraday market might fall to 5 per cent, therefore, it suggested clients to stay away from market and be underweight.
US Recession In 2023: Financial services company JP Morgan has predicted that the United States will enter a recession later this year despite improving signs for inflation and the global economy. It said that the recession will probably start in the second half of 2023.
According to a report by JP Morgan, the US market is not pricing the recession and their base case predicts that there may be a hard landing in the US market. The intraday market might fall to 5 per cent, therefore, it suggested clients to stay away from market and be underweight.
JP Morgan stated that the market could decline up to 25 per cent.
Ajay Bagga, chairman, Elyments Platforms, said that India will also be affected if the US market will crash, adding that "we have risk from the currency as well".
"If the US dollar price keeps rising, then the RBI will also increase rate and I think, one rate hike might happen in April 2023," he said.
Earlier on Tuesday, Brian Moynihan, CEO of Bank of America, also stated that the U.S. economy would experience a technical recession beginning in the third quarter. The recession wouldn't be severe, according to Moynihan, who also predicted that interest rates would start to decline in the second quarter of 2024.
The consumer sector is doing well, and the bank anticipates three quarters of negative U.S. GDP driven by a corporate slowdown, he added.
Meanwhile, according to DataTrek, oil prices are an indicator of an incoming recession – and they're flashing signs that the US will avoid a downturn.
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