Goldman Sachs Withdraws Recession Prediction After Trump Pauses Tariffs

Goldman Sachs Group economists reportedly issued a note predicting a recession due to new U.S. tariffs and then retracted that forecast a little over an hour later after President Donald Trump paused the reciprocal tariffs.

This happened Wednesday (April 9) and reflected the challenges analysts and investors face in making decisions as the administration’s trade policy evolves, Bloomberg reported Wednesday.

In its initial note, the Goldman Sachs team said there was a 65% chance of a recession in the next 12 months due to the tariffs that went into effect Monday morning, according to the report.

The team issued that note shortly before 1 p.m. in New York. Trump announced the pause in a post on Truth Social at 1:18 p.m., and the Goldman team reversed its call in another note at 2:10 p.m., the report said.

“Earlier today, before President Trump’s announcement, we had shifted to a recession baseline in response to the additional country-specific tariffs that went into effect this morning,” the second note from Goldman Sachs said, per the report. “We are now reverting to our previous non-recession baseline forecast.”

Trump said in his post on Truth Social that while he was raising the tariff charged to China by 125%, he was pausing those imposed on other countries.

“Conversely, and based on the fact that more than 75 Countries have called Representatives of the United States, including the Departments of Commerce, Treasury and the USTR, to negotiate a solution to the subjects being discussed relative to Trade, Trade Barriers, Tariffs, Currency Manipulation and Non Monetary Tariffs, and that these Countries have not, at my strong suggestion, retaliated in any way, shape or form against the United States, I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately,” Trump wrote.

Amid the evolving trade policies, chief financial officers face the imperative to potentially “rightsize” their operations and embrace new import or manufacturing strategies, PYMNTS reported Wednesday.

As global trade becomes more complex and politically fraught, CFOs are stepping beyond traditional finance functions to become architects of global supply chain strategy.

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