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Recession 'Will Rear Its Ugly Head' As Early As July, Warns Expert As 2 Rate Cuts Projected For 2025: 'Buy Bonds On Dips'

After the Federal Reserve Board and Federal Open Market Committee released their economic projections following the FOMC meeting on Wednesday, David Rosenberg issued a strong warning about a potential recession.

What Happened: According to the economic projections, the Federal Reserve’s median expectation for the unemployment rate stood at 4.4% for 2025. The projections from all participants ranged from 4.1–4.6% for the year. The central tendency excluding the three highest and lowest projected rates was between 4.3–4.4%.

Rosenberg, the founder and president of Rosenberg Research & Associates Inc, in an X post, said that these projections gave a clear “signal” that wasn't “noise”. Explaining with an example from 1948 he said that a 100 basis point increase in the unemployment rate from its cycle low has always been followed by a recession, as defined by the National Bureau of Economic Research.

The current cycle low stood at 3.4% of the unemployment rate as of April 2023.

According to him, by the time the jobless rate rises as much as the projected 4.4%, the recession would have already been in play. He said the ...