Why Retirement Investors Might Not Need to Worry About a Recession...Yet

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Fears of a recession have been building since early 2018, and a new study shows the majority of retirement investors think one is coming pretty soon.  

One big bank isn't all that worried. 

"From our standpoint, out models look out about 12 months and we don't see a recession within the 12 months," Tracie McMillion, head of global asset allocation strategy at Wells Fargo Investment Institute said. Meanwhile, McMillion mentions that a study Wells Fargo helped put together showed that 11% of interviewees who invest for retirement said they think there will be a recession in 2019. And 40% said they think a recession is coming in 2020. 

"We think, looking out 12 months, it's unlikely," McMillion said. Still, "this expansion is going to be the longest expansion in the history of the U.S. economy, so we are bumping up against that long expansion." 

In December, Morgan Stanley economists had the probability of recession tabbed at 15% for 2019 and 30% for 2020. With additional tariffs off the table for the immediate term, the risk of a recession sooner rather than later may decrease, but the Federal Reserve may now be less compelled to lower interest rates, which would have been a lift to economic growth. 

Still, the Fed is likely to reduce rates in the near future, Marc Pfeffer, chief investment strategist at CLS Investments told TheStreet. 

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