US Vice President JD Vance (C) US President Donald Trump and Elon Musk (R) exit the oval office in the opposite direction as going away from the White House on March 14, 2025.
Roberto Shmit | AFP | Getty images
UCLA Anderson’s forecast on Tuesday released its first “sewing watch”, citing adequate changes in the economy from the policies of the Trump administration.
The UCLA Anderson, which has been releasing forecasts since 1952, said that the administration’s tariffs and immigration policies and plans to reduce the federal workforce may combine to contract the economy.
The title of its analysis was, “Trump policies, if fully enacted, promise a recession.”
A news release from the forecaster states, “While there are no signs of recession yet, it is completely possible that one can be formed in a near period.”
The US recession is officially announced by the Dating Committee, the Bureau of National Economic Research Bureau. The committee appoints a variety of indicators, including production, employment, income and development, to determine whether the economy is contracting. At the moment, no specific indicators appear near the levels that will motivate the committee to declare recession.
The average defendant of the CNBC Fed survey for March published on Tuesday, estimating the possibility of 36% recession in the next year, above 23% in the earlier month. But it remains below 50% levels which strongly sturked and wrong in view of the epidemic from 2022 and 2023. This indicates how difficult it is to predict the recession, or even determining whether the economy is one. The Fed survey also shows that the recession is not the base case for most Wall Street Forecasters, only that the concern is somewhat high.
The recession occurs when many sectors of the economy contract at the same time. UCLA Anderson’s forecast stated that the immigration policies of the administration can cause lack of labor, increase tariff prices and create a contraction in the manufacturing sector, while changes in federal expenditure will reduce employment for government workers and private contractors.
The Forecaster’s statement said, “If they and their resulting response to the demand for goods and services, they create a recipe for the recession.”
‘Stagflation’
The administration officials have not pushed back from the President to their top economic lieutenants, especially against the possibility of recession from their policies. President Trump has stated that there would be “duration of transition”, while the Commerce Secretary said that it would be “worth it” for a recession that would eventually come from policies.
Recession is often the result of unexpected shocks for the economy. Increase in optimism after President Trump’s election, after a sharp decline in some surveys recently, suggests that both business and consumer were uninterrupted and even the nature of some policies is now being followed.
On time, UCLA Anderson’s forecast will only say that the recession may develop next year or two. Its report states: “Weaks are beginning to emerge in the pattern of household expenses. And with the newly introduced areas of the financial sector, elevated asset evaluation and risk, it is priced to increase any recession. What is more, what is more, the recession can end.”
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