Goldman Sachs Raises U.S. Economic Recession Probability and Tariff Rate Expectation

BlockBeats News, March 31st. In the early hours of today, Goldman Sachs significantly raised its expectations for U.S. tariffs in 2025 in a research report and warned that an escalation of trade tensions could seriously affect economic growth, inflation, and employment. The bank currently expects the average U.S. tariff rate in 2025 to increase by 15 percentage points, higher than the previous baseline of 10 percentage points. The main reason for the adjustment is that the expected comprehensive "reciprocal tariffs" to be announced by Trump on April 2nd will impose an average 15% tariff on all U.S. trading partners, with the average actual impact of tariffs expected to increase by 9 percentage points. Goldman Sachs has raised its core PCE inflation expectation for the end of 2025 in the U.S. by 0.5 percentage points to 3.5%, citing the impact of rising import costs on inflation. The GDP growth rate in the fourth quarter is expected to slow to 1.0%, down 0.5 percentage points from previous expectations, and the unemployment rate is expected to rise to 4.5% by the end of the year. Goldman Sachs has raised the probability of an economic recession in the U.S. in the next 12 months to 35%, citing weak consumer and business sentiment, and indications that policymakers may be more willing to accept the recent economic pain to pursue broader policy goals. With real income growth already slowing, the economy may be entering a more fragile stage, where sentiment and policy risks are a bigger drag on the economy than in recent years. (Jinshi)