US: Even a mild recession has become unlikely – Commerzbank

In the United States, the feared recession has so far failed to materialize – but could it still come? Economists at Commerzbank explain why we have changed their forecast and no longer expect a recession.

Recession no longer the most likely scenario

Interest rate-sensitive residential investment in the US is picking up again and US banks are slowing the tightening of lending standards. Together with the recent high pace of growth, this makes even a mild US recession less likely.

While we had previously expected a slight decline in US gross domestic product for the summer half-year, we now anticipate a moderate increase. The absence of a mild recession raises our growth forecast for 2024 as a whole from 1.0% to 2.5%; for 2025 it rises from 1.0% to 1.5%. The unemployment rate will remain very low for a long time to come.