J.P. Morgan Warns of U.S. Economic Growth Slowdown
- J.P. Morgan foresees gradual U.S. growth slowdown, questions Fed measures.
- Persistent inflation undermining growth prospects.
- Potential recession risk estimated at 40% for late 2025.
J.P. Morgan strategists indicate that U.S. economic growth is decelerating, with increased recession risks, as emphasized by Chief Global Economist Bruce Kasman’s recent statements in New York.
The slowdown, driven by structural factors and not easily countered by Fed rate cuts, poses challenges for U.S. markets, especially affecting cryptocurrency volatility.
J.P. Morgan Warns of U.S. Economic Growth Slowdown
J.P. Morgan’s latest analysis indicates that U.S. economic growth is slowing gradually. Persisting inflation and recession risks challenge optimism regarding Federal Reserve interventions. Economic strategists expect current conditions to hinder recovery efforts significantly.
Bruce Kasman, the chief global economist at J.P. Morgan, emphasized that structural factors like higher tariffs, lower immigration, and fiscal policy delays prevail over monetary actions. Kasman remarked, “We’re quite comfortable with our view that growth is going to turn subpar in a broad-based way…. While we’re not expecting recession, we still put an elevated probability of roughly 40% that the US economy could slide into recession sometime in the second half of the year.” The leadership’s outlook encompasses concerns about unwinding earlier growth tailwinds.
The U.S. economic landscape is seeing rising uncertainty among businesses and consumers, impacting equities and bonds with anticipated volatility. Recession probability in the latter half of 2025 stands at around 40%, sparking cautious market sentiment.
J.P. Morgan projects a reduced GDP growth rate of 1.3% in 2025, highlighting underlying structural challenges that dwarf potential impacts of Fed rate adjustments. This outlook suggests sustained economic pressures extending over the foreseeable future.
While crypto asset flows haven’t shown direct evidence of disruption, historical patterns link macroeconomic changes with asset fluctuations. Broad U.S. slowdowns typically influence risk appetites, reverberating in digital currencies like BTC and ETH.
Past global stagflations reveal similar slow-growing conditions, as risks resurface for traditional and crypto markets. The period could see funds rotate toward stablecoins due to speculative asset underperformance. Rate adjustments offer limited respite, given complex underlying economic dynamics.
