Popular economists believe the United States could already be in recession, contrary to the belief of many CEOs and business leaders that a recession is not coming. Notably, Wall Street giant JPMorgan’s prediction of an increase in the US recession prospects by the end of the year spurred fears in the market.
Economists Say the United States May Be In Recession
While the latest initial jobless claims data provided some relief to the stock and crypto market, US recession fears continue to persist. Bitcoin and Ethereum prices witnessed a 7% and 6% jump in the last few hours respectively, building momentum for the upside after the recent crash.
The initial jobless claims fell more than expected for the week ending August 3. People claiming unemployment benefits in the US fell by 7K to 233K below market expectations of 240K.
Economist David Rosenberg in an interview with Bloomberg said “We are either in a recession or about to confirm one.” He thinks despite the weekly initial jobless claims dropping more than expected, the real concern is the rapidly increasing unemployment rate.
Rosenberg’s claims somewhat resonate with former Federal Reserve economist Claudia Sahm who said that “While the US isn’t yet in a recession, it’s uncomfortably close.”
It is incredible that I continue to read and hear how the rise in the unemployment rate is due to booming immigration. Nary a word that all this has done is act as an antidote to the fact that the native-born U.S. population has dropped -0.3% over the year to July. Total…
— David Rosenberg (@EconguyRosie) August 8, 2024
On the contrary, business leaders in the U.S. say they don’t see any signs of recession and the U.S. economy remains resilient. Roland Busch, CEO of Siemens, said the market is a bit muted ahead of the US election. Also, Disney CFO Hugh Johnston thinks the economy will continue to strengthen, bringing back consumers.
JPMorgan Warns About Peak in Fourth Quarter
Wall Street giant JPMorgan has raised the odds of US recession to 35%, up from 25% as of the start of last month. JPMorgan now sees just a 30% chance of the Federal Reserve and its peers keeping interest rates “high-for-long,” as compared with the earlier 50-50 estimates two months back. JPMorgan predicted that the U.S. Federal Reserve would cut rates by half a percentage point in September and November.
CME FedWatch tool shows a 57.5% chance of a 50 bps rate cut in September and 47.5% probability of 50 bps rate cut in December. Currently, the Bank of Japan has pushed back its plans for any rate hike due to market instability, renewing cautious buying in the market.
BTC price surpassed $59,500 to an intraday high of $59,726, up 7% in the last 24 hours. The trading volume is low, indicating that the buying activity could be coming from institutional investors. While retail investors were selling their holdings during the crash last week, institutional investors bought the dip.
Also Read: Bitcoin Sees Strong US Buying Pressure Amid US Recession Fears
The post Economists Contradicts With Executives On US Recession, Bitcoin Nears $60K appeared first on CoinGape.
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