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After the release of US retail sales and initial employment data this week,Goldman SachsReduce the risk of US recession.

Goldman Sachs economist Jan Hatzius said in a note to clients on Saturday:The probability of a recession next year was lowered to 20% from 25%.

Hatzius further noted that if the August non-farm payrolls report, which is scheduled to be released on September 6, looks quite good,We may lower our chance of a recession to 15%, this level has lasted for nearly a year.

U.S. retail sales in July posted their biggest increase since early 2023, while government data showed the number of applications for unemployment benefits last week was the lowest since early July. A slew of data highlighting the resilience of the U.S. economy helped push U.S. stocks to their best week of the year as investors rushed to buy stocks at the bottom of the recent sell-off.

Regarding the outlook for interest rate cuts, Goldman Sachs economists said:They are more confident that the Fed will cut interest rates by 25 basis points at its September policy meeting, but the risk of another unexpected decline in non-farm payrolls in August could still trigger a 50 basis point cut.