The U.S. may be heading toward a rececession Opens a New Window. , possibly within the next two years according to a number of business economists.
The National Association for Business Economics is focusing on the end of 2021.
The concern is about the risks presented by some of President Donald Trump’s Opens a New Window. economic policies.
Thirty-four percent of economists surveyed, in a report published on Monday, said they believe a slowing economy will tip into recession in 2021.
That’s up from 25 percent in a survey taken in February. Only 2 percent of those polled expect a recession to begin this year, while 38 percent predict that it will occur in 2020.
The economists have previously expressed concern that Trump’s tariffs and higher budget deficits could eventually dampen the economy.
The Trump administration has imposed tariffs on goods from many key U.S. trading partners — from China and Europe to Mexico and Canada.
Officials maintain that the tariffs, which are taxes on imports, will help the administration gain more favorable terms of trade.
But U.S. trading partners have simply retaliated with tariffs of their own.
Trade between the U.S. and China, the two biggest global economies, has plunged.
Trump decided last Wednesday to postpone until Dec. 15 tariffs on about 60 percent of an additional $300 billion of Chinese imports — granting a reprieve from a planned move that would have extended duties to nearly everything the U.S. buys from China.
The financial markets signaled the possibility of a U.S. recession last week, adding to concerns over the ongoing trade tensions and word from Britain and Germany that their economies are shrinking
The economists surveyed by the NABE were skeptical about prospects for success of the latest round of U.S.-China trade negotiations.
Only 5 percent predicted that a comprehensive trade deal would result, 64 percent suggested a superficial agreement was possible, and nearly one quarter expected nothing to be agreed upon by the two countries.
As a whole, the business economists’ recent responses have represented a rebuke of the Trump administration’s overall approach to the economy.
Still, for now, most economic signs appear solid. Employers are adding jobs at a steady pace, the unemployment rate remains near a 50-year low, and consumers are optimistic.
U.S. retail sales figures out last Thursday showed that they jumped in July by the most in four months.