This is the main finding of a report released Monday by the National Association for Business Economics. The poll, based on responses from 53 economists, is a leading barometer for the US economy's assessment that the economy is on track.
"Increased trade protectionism is seen by the majority of respondents as the primary downside risk to growth," said Gregory Daco, chief economist at Oxford Economics, in a statement. The report noted what economists termed the "rise" of recession fears.
The report was released when the US tightened its trade war with China and persecuted other major trading partners such as Mexico and India.
] The risk of an early recession remains low, but will "rise rapidly" next year. Respondents indicated that the recession risk would only be 1
5% from 2019 and 60% by the end of 2020. About a third of respondents predict that a recession will begin in the middle of next year.
According to the survey, the average growth forecast for gross domestic product in the last quarter of 2020 was 1.9%. This would be a huge decline from the latest estimate of 3.1% current US economic growth in the first three months of 2019.
The United States is likely in the last phase of epic economic growth that began in 2019 2009. Dramatic and coordinated responses from the Federal Reserve, Congress and the Obama administration have helped lift the country out of the Great Recession.
President Donald Trump, who took the reins of the US economy from Barack Obama Year 2017 has aggressively tried to reorganize the US position on world trade. He has led significant struggles with China and Europe, threatening tariffs on Mexico for illegal immigration and India for access to its markets.
Other Notable Results from the National Association for Business Economics:
– 56% of respondents said that protectionist trade policy in 2019 represents the greatest risk to the US economy retaliation by other nations, which is why they have their GDP Growth forecasts lowered.
– 14% believe that a "significant" decline in equity markets and a 10% slowdown in global growth are the biggest risks to the US economy.
– Business spending will slow down this year and next, following strong growth of 6.9% in 2018.