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Goldman Sachs Flags Market Correction Risk As Inflation, Trump Policies Stir Uncertainty

Benzinga ·  Jan 9 07:04

The start of 2025 has brought a sharp uptick in equity drawdown risks, with Goldman Sachs estimating a near 30% probability of market corrections, fueled by surging policy uncertainty and shifting inflation dynamics.

In a note published Wednesday, analystsAndrea FerrarioandChristian Mueller-Glissmannhighlighted heightened risks stemming from rising inflation pressures, trade tensions and political uncertainty ahead ofDonald Trump's second presidential term, set to start on Jan. 20, 2025.

The analysts indicated that these factors could lead to deeper market volatility and weaker forward returns for equities.

What Is Driving The Increased Risk?

Goldman's framework shows the probability of...

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