Major Bank Is First To Forecast A Recession — More Could Follo | Forbes

Major Bank Is First To Forecast A Recession — More Could Follow

An increasing number of Wall Street experts are now forecasting a possible economic downturn on the horizon, with alarms growing louder after the widely-observed yield curve inverted last week and indicated a looming recession.

Deutsche Bank on Tuesday became the first major bank on Wall Street to forecast a recession next year, albeit a “moderate” one, thanks to the combination of surging inflation and rising interest rates.

The firm’s economists predict the U.S. economy will take a “major hit from the extra Federal Reserve tightening by late next year and early 2024,” while also predicting “two negative quarters of growth and a more than 1.5% rise in the U.S. unemployment rate.”

Goldman Sachs analysts similarly warned in a recent note that the period of stagflation that occurred in the 1970’s is the most “clear example” of the economic environment investors are facing today.