J.P. Morgan economist sees 40% US recession chance and risks to 'exorbitant privilege'
SINGAPORE, March12 (Reuters) - There is about a 40% chance of a U.S. recession this year and a risk of lasting damage to the country's standing as an investment destination if the administration undermines trust in U.S. governance, according to J.P. Morgan's chief economist.
"Where we stand now is with a heightened concern about the U.S. economy," Bruce Kasman, the U.S. investment bank's chief global economist, told reporters in Singapore on Wednesday.
He said he has not yet revised any forecasts, but put a roughly 40% recession risk into the outlook - up from about a 30% chance he had reckoned on at the start of the year. J.P. Morgan's current forecast is for 2% U.S. GDP growth this year. U.S. stocks have suffered their sharpest selloff in months over recent days as investors have grown nervous that President Donald Trump will slow the economy with import duties.
Ninety-five percent of economists polled by Reuters last week across Canada, Mexico and the U.S. said recession risks in their economies had increased as a result of Trump's tariffs.
Economists at Goldman Sachs and Morgan Stanley last week downgraded their U.S. GDP growth forecasts and now see growth at 1.7% and 1.5% this year, respectively.
