From Yahoo Finance: 2025-05-21 15:37:00

The S&P 500 faced a turbulent year with concerns about stagflation, recession, and tariffs causing a 19% drop after reaching an all-time high. President Trump’s tariff pause sparked a 20% recovery, but economic worries persist.

Federal Reserve Chairman Powell faces a tough task balancing low inflation with rising unemployment. Inflation remains above targets, with the job market weakening and layoffs increasing. Economic activity slowing is dampening consumer confidence.

Wall Street grapples with uncertainty as Morgan Stanley predicts slower growth and stickier inflation. The Fed is expected to delay interest rate cuts, leading to tepid GDP growth and rising unemployment. The US debt situation is projected to worsen, with deficits climbing.

Read more: Morgan Stanley reveals mid-year recession, interest rate cut forecast