JPMorgan Foresees U.S. Economic Growth Amid ‘Ridiculous’ Fitch Downgrade and Recession Fears
JPMorgan’s team of economists, led by chief U.S. economist Michael Feroli, has revised its earlier recession projections and now holds a more optimistic view of the U.S. economy. Here are the key points:
- A recession is no longer the bank’s modal scenario, but the risk of a downturn is still high.
- Potential risks include the Federal Reserve continuing to raise interest rates and the delayed effects of previous tightening measures.
- JPMorgan predicts an economic resurgence in 2023, followed by a period of modest growth in the following year.
- Despite Fitch Ratings’ decision to lower the U.S. credit rating, JPMorgan’s CEO Jamie Dimon dismisses it as “ridiculous” and emphasizes the strength of the U.S. economy.
- The bank’s economists doubt their previous forecasts of a mild contraction next quarter due to the current economic growth.
In conclusion, JPMorgan is confident in the U.S. economy’s ability to avoid a full-scale recession and expects continued growth in the coming years.
Hot Take
JPMorgan’s optimistic outlook reflects a belief in the resilience and strength of the U.S. economy, despite external factors such as the Fitch downgrade. While risks remain, the bank’s economists are confident in their revised projections and anticipate a period of growth ahead.
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