April 1 - Goldman Sachs (GS, Financial) has lowered its year-end S&P 500 target for the second time this month amid concerns over rising tariffs, slowing growth, and persistent inflation.
Chief U.S. Equity Strategist David Kostin noted that a combination of higher tariffs and weaker economic performance prompted the firm to cut its forecast from 6,200 to 5,900. This revised outlook is about 5.4% above Monday's close of roughly 5,597.
Economists now expect the average U.S. tariff rate to climb to 15% this year from a prior estimate of 10%, driven by more aggressive assumptions regarding reciprocal tariffs, said Chief Economist Jan Hatzius. In tandem, Goldman has increased its 12-month recession probability to 35% from 20% and trimmed its 2025 GDP forecast to 1.0% from 1.5% on a Q4 basis.
Hatzius attributed the adjustments to deteriorating household and business confidence, as well as recent comments by White House officials, which signal a willingness to tolerate near-term economic weakness.
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