economy Markets

Why One Bank ‘Remains Resolutely Pessimistic’ About 2020

If they're right, they will look like geniuses.

This isn't exactly surprising, but it's notable nevertheless. SocGen's outlook for the global economy (and especially for the US economy) in 2020 is overtly bearish compared to consensus and certainly compared to more upbeat outlooks from, for example, Goldman. In their year-ahead multi-asset strategy piece (released on Tuesday), the bank references their economists' 2020 outlook. In that piece, one finds a section that carries this title: "We remain resolutely pessimistic on the 2020 growth outlook". It's not unusual for SocGen to sound a somewhat dour tone, and it should definitely be emphasized that the bank sees a synchronized upturn in 2021. Also, they do not call for a deep downturn in the US in 2020. And yet, they do see a mild recession stateside next year (in Q2 and Q3) and have stuck with that call for a while now. To be clear, the likes of the IMF, the OECD and the WTO are pessimistic too, but SocGen's estimates are remarkably far afield from consensus and they are more than open about it. "Our 2020 growth forecasts are below the consensus forecasts for practically all the economies we cover", the bank writes. Indeed, one of the reasons their global GDP forecast sho
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1 comment on “Why One Bank ‘Remains Resolutely Pessimistic’ About 2020

  1. Bas says:

    Yeah, I’d tend to lean more with SocGen on this. Plus, from a political (or philosophical) point of view, a mild recession might be worth it to get Trump axed.

    H, any research on recession following an easing cycle? Sadly I’m starting to believe rates matter much more than actual profits.

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