Recession Risk: Impact on Crypto Markets

Goldman Sachs Raises US Recession Probability to 35%, Impacting Crypto

• Goldman Sachs increased the 12-month US recession probability to 35% due to rising tariffs and weakening growth.
• The firm expects US tariff rates to rise by 15 percentage points in 2025, with an effective increase of around 9 percentage points.
• Goldman downgraded its 2025 US GDP growth forecast by 0.5 percentage points to 1.0% and raised its year-end core PCE inflation forecast to 3.5%.
• The unemployment projection was increased to 4.5%, reflecting a stagnating growth environment with inflationary pressures.
• Bitcoin’s sensitivity to macroeconomic conditions is highlighted, with potential risk-off pressure due to yield curve inversion and limited monetary stimulus options.

Goldman Sachs’ revised economic outlook includes a higher recession probability, impacting cryptocurrencies like Bitcoin, which are increasingly influenced by macroeconomic factors such as tariffs and inflationary pressures.