No recession coming – Current projections have the US economy pulling off a soft landing.

The U.S. economy is on relatively solid footing heading into the second half of 2024. But while inflation has cooled, progress has been choppy and inconsistent. Labor markets have remained stable, but the Federal Reserve has been forced to delay its pivot to interest rate cuts. Many economists, including Federal Open Market Committee (FOMC) members, anticipate a soft landing for the U.S. economy in 2024 that includes slowing GDP growth but no recession. However, a single misstep in Fed policy could easily slow the economy so much that it contracts into a recession, making the next several months a critical period for the central bank. Economic recessions are no reason for panic and have been a regular occurrence over the past century. However, investors can make the most of a difficult situation by knowing which risk factors to watch and how to position their portfolios to optimize their performance if a recession is looming in 2024 or 2025.