Goldman Sachs among the most optimistic on Wall Street that U.S. will avoid recession

MicroStockHub

Goldman Sachs believes the U.S. will most likely avoid a recession in 2023, putting it in the minority among Wall Street forecasters, who generally think a downturn is the most probable scenario.

According to an investor note put out this week, the investment bank thinks there exists a 35% chance that the U.S. will face a recession. Meanwhile, Goldman estimates that the median forecast figure of Wall Street experts sits around 65%.

“We think a US recession is less likely than the median forecaster does," Goldman said, backing up this claim with the following graph, which shows its recession estimate at the low end of published predictions:

See chart below:

Additionally, the note highlighted that Goldman is “above consensus on U.S. growth.” For 2022, Goldman predicts U.S. real GDP growth of 1.9% compared to the consensus figure of 1.8%. The institution continues that view into 2023 as it sees GDP growth at 1.0% versus the 0.4% consensus figure.

Lately, hope that the Federal Reserve will be able to back off its aggressive rate-hiking campaign, fed by tamer-than-expected inflation statistics last week, have inspired the major averages (SP500), (DJI), (COMP.IND), and their mirroring ETFs (NYSEARCA:SPY), (NYSEARCA:VOO), (IVV), (NYSEARCA:DIA), and (NASDAQ:QQQ), to rebound from their October lows.

For the other side of the recession argument, Russell Investments believes that the U.S. is not in a downturn at the moment but more than likely will be by the end of 2023.