Recession Risk Nears 50% as U.S. Economy Faces Slower Growth and Inflation Challenges

The Federal Reserve projects 1.7% GDP growth and a 2.8% inflation rate for 2025, as consumer confidence declines and spending habits shift.

A Deutsche Bank survey estimates a 43% probability of a U.S. recession in the next 12 months, with other forecasts ranging up to 50%.
The Federal Reserve has lowered its 2025 GDP growth forecast to 1.7%, the slowest rate since 2011 outside the COVID-19 recession.
Core inflation is projected to rise to 2.8%, exceeding the Fed's 2% target and raising concerns about potential stagflation.
Consumer sentiment has dropped significantly, with the University of Michigan's Consumer Sentiment Index falling 10.5% in March 2025.
Experts recommend financial strategies such as reducing high-interest debt, building emergency savings, and diversifying investments to prepare for potential economic challenges.