Steven Deller, professor of Agricultural and Applied Economics at the University of Wisconsin-Madison, said businesses remain in “wait and see mode,” as they’ve dealt with economic uncertainty since the Federal Reserve began raising interest rates more than a year ago.
“Six months ago, it was like, the Fed is raising interest rates, the sky is falling, the leading economic indicators are all pointing towards recession,” Deller said. “Now, people are going, ‘Well, wait a minute, the sky is not falling.'”
Menzie Chinn, a professor of public affairs and economics at University of Wisconsin-Madison, said Goldman Sachs’ prediction might be a little rosier than that of most economists. He said economists are anticipating an economic slowdown in the latter half of 2023 or early 2024.
“While people think the chances of a recession are receding, I think the average forecaster still sees a recession coming,” Chinn said. “That being said, I think most of them also think it would be a mild recession.”