Economy Takes Another Hit: BCA Research Forecasts Stock Market Volatility, Recession Possibility in US

The US economy is facing yet another blow as concerns about financial stability resurface. BCA Research predicts volatility in the US stock market, with chief global strategist Peter Berezin warning clients that a recession may occur either this year or in early 2025. The S&P 500 could drop to 3,750, a 30% decrease from current levels, according to Berezin’s analysis.

The relationship between inflation and unemployment, known as the “Phillips curve,” plays a key role in Berezin’s prediction. He explains that the US avoided a recession in 2022 and 2023 due to the economy operating along the steep side of the Phillips curve, resulting in an “immaculate disinflation.” However, he forecasts challenges in the global economy, with notable slowdowns expected in growth in China and Europe. This could lead to increased pressure on international stock markets.

Despite hitting a record high in mid-May, the Dow Jones Industrial Average has dropped from those peaks. This grim prediction comes at the end of a turbulent year for the market and may be one of the most pessimistic on Wall Street. In other news, K Kavitha’s bail plea was recently dismissed by the Delhi High Court, seen as a setback for KCR in Telangana by many.