J.P. Morgan AM: Business surveys suggest the US economy will continue to cool

J.P. Morgan AM: Business surveys suggest the US economy will continue to cool

28 november 2022

Vooruitzichten Verenigde Staten

Forward looking components of key US business surveys indicate that the US economy will continue to cool. In both services and manufacturing sectors, new business indicators moved further into contractionary territory.

This supports our view that the US will enter a recession next year. Importantly for the Federal Reserve (Fed), however, output price pressures are also softening. This reduces the likelihood of the Fed having to tighten significantly more than the market is pricing and increases our confidence that any recession will likely be relatively mild.

As we discuss in our 2023 Investment Outlook, stocks have largely priced in a moderate recession already, and thus we feel that 2023 is likely to be ‘A bad year for the economy, a better year for markets.’

28112022 J.P. Morgan AM

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