U.S.-China trade war increases recession likelihood, analysts say
By Tory Newmyer
August 13 at 7:33 AM
The problem isn’t so much that stocks keep falling. It’s why they keep falling.
The Dow Jones industrial average dropped another 1.5 percent on Monday to close down 5 percent off its all-time high of a month ago.
That retreat on its own should be too meager to stir serious concern among investors. But Wall Street economists increasingly say the U.S.-China trade war driving the sell-off poses a more serious risk than they have given it credit for. Some are now downgrading their projections for economic growth at home as a result and even raising their projections for the likelihood of a recession.
“Fears that the trade war will trigger a recession are growing,” Goldman Sachs chief economist Jan Hatzius wrote in a Sunday note.
His team estimates the conflict will shave 0.6 percent off U.S. economic growth, and it just downgraded its estimate for fourth-quarter GDP growth to 1.8 percent, well below the 3 percent rate of expansion President Trump has promised.
more:
http://www.washingtonpost.com/news/powerpost/paloma/the-finance-202/2019/08/13/the-finance-202-u-s-china-trade-war-increases-recession-likelihood-analysts-say/5d51dc8888e0fa7e7f3082a2/
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