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US President Donald Trump announces that his administration has reached an agreement with the Skadden, ARPS, Slate, Meagher & Flom Elite Law During the Oval House on March 28, 2025 in Washington, Colombia.
Andrew Harnica | Gets the image
Happy Decisions this week for President Donald Trump’s last round, Goldman Sachs expects aggressive duties from the White House to increase inflation and unemployment and drag economic growth to almost non -standard.
Currently, the investment bank expects that the tariff rates will jump on 15 percentage points, its previous “risk” scenario, which now looks more likely when Trump announces mutual tariffs on Wednesday. However, Goldman noted that the exceptions of products and countries will eventually increase to 9 percentage points.
When new outlets are taken, the Goldman economic team led by the head of global investment research, Jan Hatus, sees a wide, negative impact on the economy.
The firm said in a note on Sunday that “we still believe that the risk of tariffs on April 2 exceeds many market participants.”
Inflation above target
When inflation, the firm sees its predominant basic measure, except for food and energy prices, reaching 3.5% in 2025, increasing by 0.5 percentage from the previous forecast and significantly above 2% of the federal reserve target.
This, in turn, will come with weak economic growth: only 0.2% per annum in the first quarter and 1% for the whole year, when it is measured from the fourth quarter of 2024 to Q4 2025, decreasing by 0.5 percentage point from the previous forecast. In addition, the Wall -Rate firm sees that unemployment reaches 4.5%, which is 0.3 percent of the previous forecast.
Currently, Goldman expects 35% chance of recession in the next 12 months, which is compared to 20% in the previous forecast.
The forecast depicts a chance of chances Economy Stagflationwith low growth and high inflation. The last time the United States saw that Stagflation was in the late 1970s and early 80s. Then the Fed Paul Volker dramatically raised interest rates, sending the economy to the recession when the Central Bank chose the fight against inflation for support for economic growth.
Three decreases rates
Goldman economists do not see that this is this time. In fact, the firm now expects the Fed to reduce its benchmark three times this year, suggesting that the interest of a quarter of the interest point compared to the preliminary design of two decreases.
“We pulled the lonely 2026 year in our forecast Fed in 2025, and now we expect that this year, September, September, and November, and now we expect that three consecutively decreased in July, in November, which will leave our terminal forecasting in the unchanged state by 3.5% -3.75%,” 4.25% to 4.50% today.
Although the degree of the last tariffs is still unknown, Wall Street Journal reported on Sunday The fact that Trump pushes his team to more aggressive levies, which can mean a 20% blow to the board for US trading partners.
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