Morgan Stanley CEO sees 50% possibility of recession for US economy

By Ovunc Kutlu

ANKARA (AA) - Morgan Stanley Chief Executive Officer James Gorman said he sees a 50% chance of recession for the US economy.

"It’s possible we go into recession, obviously, probably 50-50 odds now," he said during a financial conference held by Morgan Stanley in New York on Monday.

"We’re unlikely at this stage to go into a deep or long recession ... I don’t think we’re falling into some massive hole over the next few years, I think eventually the Fed will get hold of inflation," he added.

Consumer inflation in the US rose 8.6% in May – its highest annual increase in more than 40 years.

Many investors fear that the US Federal Reserve's aggressive monetary policy could push the American economy into a recession, which caused a major sell-off in the markets in recent weeks.

Gorman, however, noted that economic fundamentals, such as balance sheets of companies, are in better shape than they are perceived in the markets.

Earlier this month, JPMorgan CEO Jamie Dimon also warned investors to "brace" for a "hurricane" in the current financial environment, which is dominated by major hurdles such as the Fed's monetary tightening, global supply chain disruptions and record inflation.