Analysts at Goldman Sachs now see the risk that the United States enters a recession during the next year due to the war between Russia and Ukraine.
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“The downgrade of our US GDP forecast will reflect rising oil prices and other drags on growth related to the war in Ukraine“.
“Now you see the risk of the United States entering a recession over the next year.”
“The growth forecasts for the Real GDP: +0.5%/+1.5%/+2.5%/+2.5% Q1-Q4 2022 vs. +1.0%/+2.5%/+2.5%/+2.0% seen previously.”
“GDP growth forecast for 2022 will be +2.9% p.a. vs. +3.1% prior.”
“Even after these rebates, we continue to see risks around our forecast of growth are skewed downwards, particularly if sanctions increase or if oil prices rise furtherfor example, to the $175/bbl price target that our commodity strategists see as possible if supply losses reach 4 million barrels/day.”
“What’s more, we have not assumed any impact on growth due to metal shortagessince, apart from palladium, only a small part of US demand for raw materials is met by Russian exports.”
“However, whether supply chain disruptions lead to sourcing challenges for key metals and other inputs that constrain production (as has already happened for some European car manufacturers), the negative impact on growth could be more substantial.”
Source: Fx Street
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