The U.S. stock market has been highly volatile, influenced by President Trump's statements. Goldman Sachs CEO David Solomon suggests that the Trump administration should focus on finalizing trade agreements to provide clarity to investors, which could stabilize the market.
Solomon emphasized the importance of having a clear roadmap for policies, as this would restore investor confidence and bolster the stock market. He noted that financial markets often overreact to macroeconomic changes, such as the tariffs imposed by Trump, and that a lack of policy clarity could have long-term effects.
Investors are concerned about the current level of uncertainty and the rapid pace of change. Solomon pointed out that the macroeconomic environment has shifted significantly compared to a few months ago, leading to increased uncertainty and impacting asset prices and market dynamics.
The International Monetary Fund (IMF) has also adjusted its forecast for U.S. economic growth, lowering it by 0.9 percentage points to 1.8%. The IMF now assesses a 40% chance of a U.S. recession, up from 25% in October, warning that the situation could worsen if trade tensions escalate.
