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Goldman Sachs Downgrades U.S. Economy Forecast

The news cycle is currently awash with stories about both coronavirus and the global and U.S. economy. Add Goldman Sachs to the mix, as the financial giant has issued a stark warning about the precarious nature of the markets and the prospects of a global recession.

Goldman Sachs Predicts a Recession

Goldman Sachs’ economic research team believes the U.S. economy will “contract sharply” over the next quarter. This shrinking, which coronavirus is accelerating, will continue through April, with further outlooks uncertain.

The team, led by Jan Hatzius, a leading economist, expects real growth of 0% for the GDP in the current quarter, with a contraction of around % in the next quarter. Any future growth, they argue, will depend on the success of “social distancing” campaigns and how they impact coronavirus transmission in the United States. Goldman Sachs initially expected an economic recovery after April. But that optimism continues to dampen, thanks to the deteriorating situation at home and abroad.

Economy In a Constant State of Flux

The Goldman Sachs outlook on the U.S. economy isn’t set in stone. The economy is currently on a wild rollercoaster ride. In fact, the ride is so wild that Slate has bluntly stated that “you should be absolutely terrified.” Fortunately, it’s not just think tanks and writers who are worried. The Federal Reserve and White House are also nervous, dropping interest rates to historic lows. There’s even talk over a massive $850 billion bailout of various industries to try and arrest the freefall.

Of course, any stimulus package will likely look much different from what the Trump Administration is proposing. As more and more sectors begin to struggle under the weight of the pandemic, it’s likely the aid package could grow further, even against the wishes of some hard-liner Republicans.

Stay Up to Date with the Latest Information

In times like these, the only thing that’s for sure is uncertainty. At BestCards.com, we understand how worrying the coronavirus pandemic can be from a physical – and fiscal – standpoint. That’s why we promise to provide you with the most up-to-date information possible.

Related Article: How Does the Coronavirus Rate Hike Affect Your Credit Cards?

 

 

About: Cory

Cory is BestCards.com's resident rewards expert, covering all facets of the points game – especially travel, hotels, and airlines. In addition to credit cards, Cory finds that jogging, cats, and memes are essential parts of a balanced day.