Goldman Sachs: Lowering US recession expectations, but it doesn't necessarily mean US stocks will rise.

Goldman Sachs has lowered the possibility of a recession in the US economy for the third time since June last year.

Goldman Sachs now believes that the likelihood of a US economic recession is 15%, down from 20% in July. In March of this year, due to the impact of market volatility on regional banks, this possibility was 35%.

Of course, Jan Hatzius, Chief Economist at Goldman Sachs, still believes that the US economy will slow down in the fourth quarter. However, in a report on Monday, he stated that this would be "mild and short-lived."

A Bloomberg survey shows that economists believe that with aggressive rate hikes impacting the economy, the likelihood of a US economic recession next year is about 60%.

Goldman Sachs lowered its recession forecast after employment data showed an increase in the unemployment rate.

But Hatzius is not worried - the rise in the unemployment rate is due to an increase in labor force participation. At the same time, the inflation index is being distorted. He said that potential inflation may already be close to the Federal Reserve's target.

This prepares the US for a so-called soft landing. Hatzius said that his confidence in the Federal Reserve's completion of rate hikes has only increased in the past month.

However, a favorable economic outlook may not be of much help to US stocks.

Hatzius said that the predictions of Goldman Sachs' stock strategists show that most of the gains in the US stock market from the expectations of a soft landing and the prosperity brought by artificial intelligence have already been realized.