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Tags: CNBC | Recession | Economy | growth

CNBC Poll: Chance of Recession Hits Highest Point in 2 Years

CNBC Poll: Chance of Recession Hits Highest Point in 2 Years
(Dollar Photo Club)

By    |   Wednesday, 28 October 2015 07:35 AM EDT

A CNBC survey finds that the chance of recession in the next 12 months jumped to a two-year high amid an increasingly dismal outlook for U.S. economic growth.

“Respondents to the survey, including economists, fund managers and analysts, see a 22 percent chance of a recession in the next year, up from 19 percent last month and the highest level since the fiscal cliff debate seized Washington and the nation in January 2013,” CNBC’s Steve Liesman reported.

“The chance of recession, however, remains well below its all-time high of 36 percent in 2011, but higher than the 13 percent all-time low at the beginning of this year.”

Fears are rising that the struggling economy is stalling — if it hasn't already.

"The economy is losing momentum in a way that in the past has been consistent with the Fed cutting interest rates, certainly not raising them," Mark Vitner, a senior economist at Wells Fargo, wrote in response to the survey.

While about half of the respondents forecast the first rate hike this year, the other half sees it into 2016 and even, for some, as late as 2017.

"The earliest possible liftoff date for the FOMC is now January," wrote John Donaldson, vice president of Haverford Trust. "That would likely require a good to very good holiday season for consumer spending combined with a winter without a polar vortex," he said.

To be sure, some fear the central bank will wait far too late to act.

"There is an increasing risk that the Federal Reserve will be too slow in beginning to normalize interest rates and will need to raise rates much more aggressively in the future," said Mark Zandi, chief economist of Moody's Analytics.

Meanwhile, recession fears are growing among large U.S. companies that are expected to report quarterly declines in profits and sales for the first time since the recession, according to The Wall Street Journal.

“The industrial environment’s in a recession. I don’t care what anybody says,” said Daniel Florness, chief financial officer of Fastenal Co., the newspaper reported.

A third of the top 100 customers for Fastenal’s nuts, bolts and other factory and construction supplies have cut their spending by more than 10 percent and nearly a fifth by more than 25 percent, he said.

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StreetTalk
A CNBC survey finds that the chance of recession in the next 12 months jumped to a two-year as Wall Street continues to downgrade the outlook for U.S. growth and push out the date for the first Fed rate hike.
CNBC, Recession, Economy, growth
401
2015-35-28
Wednesday, 28 October 2015 07:35 AM
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