Did the US head to Trump’s recession?

During his election campaign, last year, Donald Trump promised the Americans to lead to a new era of well -being.

Now two months after his presidency, he draws a slightly different picture.

He warned that it would be difficult to reduce the prices, and the public should be prepared for a “small violation” before he could return the wealth to the US.

Meanwhile, analysts say the chances of recession are increasing by pointing to his policy.

So is Trump to call a recession in the world’s largest economy?

In the US, recession is defined as a long and widespread decline in economic activity, usually characterized by unemployment jump and income.

The Choir of Economic Analysts has warned in recent days that the risks of such a scenario were growing.

The JP Morgan report included a chance of 40%, which compared to 30% at the beginning of the year, warning that US policy is “deviating from growth”, while Mark Zandy, Moody’s Chief Economist, increased the chances from 15% to 35%, citing tariffs.

The forecasts occurred as the S&P 500, which tracks the 500 largest companies in the United States. He has now fallen to the lowest level since September in fear of the future.

Market shocks are partly due to the concern of new taxes on imports called tariffs that Trump has submitted ever since he entered the post.

He struck the products from the three largest trading partners in America with new duties and threatened them more widely in the course, which analysts are believed to increase prices and hold back growth.

Trump and his economic advisers warn that the public will be ready for some economic pain while releasing Market problems – a noticeable change in its first term when it often referred to the stock market as a measure of its own success.

“There will always be changes and adjustments,” he said last week in response to the requests of enterprises for greater confidence.

The outside increased the concerns of investors about his plans.

Last week, Goldman Sachs raised the recession rates from 15% to 20%, saying that the economy has a change in policy as a “key risk”. But it was noted that the White House still had “the opportunity to get back when the risks of the shortage would start to look more serious.”

“If the White House remained committed to its politics, even in the conditions of much worse data, the risk of recession would increase further,” the firm’s analysts warned.

For many firms, the biggest question is tariffs that increase the cost for US enterprises, investing import taxes. Because Trump reveals tariff plans, many companies face less profitable profit while upholding investing and hiring when they try to find out what the future will look.

Investors are also worried about large cuts in government labor and government spending.

Brian Gardner, Head of Washington’s Political Strategies at the Stifel Investment Bank, said businesses and investors believed that Trump has appointed tariffs as a tool for negotiations.

“But the fact that the president and his office signal is actually a bigger thing. This is the restructuring of the American economy,” he said. “And this is what has been moving in the last couple of weeks.”

The US economy has already experienced a slowdown, partially developed by the Central Bank, which supported the interest rates higher to try to cool the activity and stabilize the prices.

In recent weeks, some data suggest faster weakening.

Retail sales fell in February, confidence – which jumped out after Trump’s election for several consumer and business polls – and companies, including large airlines, retailers such as Walmart and Target and manufacturers, warn about return.

Some analysts are worried that drop in the stock market can cause further inclusion of costs, especially among households with higher income.

This can give a serious blow to the US economy, which is caused by consumer costs and is increasingly dependent on these richer households, as families with smaller income are facing inflation.

Last week, the head of the Central Bank of the United States Jerome Powell proposed assurances in the speech, noting that the moods were not a good behavior in recent years.

“Despite the increased level of uncertainty, the US economy is still in a good place,” he said.

But the US economy is currently deeply linked to the rest of the world, Kathleen Brooks, Director of the XTB research.

“The fact that tariffs can violate, at the same time, when there are signs that the US economy is weakening anyway.

Anxiety in the stock market is not all about Trump.

Investors have already become sure of the possibilities of correction, after high income over the last two years, due to the sharp impact in technological promotions, which are fueled by investor optimism regarding artificial intelligence (AI),

For example, the Chipmaker Nvidia manufacturer saw that the stock price jumping from less than $ 15 in early 2023 to almost $ 150 in November last year.

This type of lifting has launched a discussion about the AI ​​bubble – with investors who have carried out great readiness for the signs that would have a great impact on the stock market, regardless of the dynamics in the broad economy.

Now that the views on the US economy are darkening, the optimism about AI becomes even harder to support.

This week, Technical Analyst Jin Monster of Deepwater Asset Management wrote that his optimism “made a step back” when the recession chance increased “measuring” over the last month.

“The essence is that when we enter the recession, it is very difficult to continue the AI ​​trade,” he said.