Bond Giant Pimco Expects 30 Percent Chance Of U.S. Recession In ’19 | 8/4/2015 | Staff
lukealukea (Posted by) Level 4
NEW YORK (Reuters) – Declining global economic growth rates will boost defensive stocks and could lead to opportunities in emerging market currencies and mortgage bonds in the year ahead, asset manager Pacific Investment Management Co (Pimco) said in its 2019 outlook on Thursday.

Higher interest rates and fading fiscal stimulus will leave the U.S. economy at a 30 percent chance of falling into a recession, the highest probability at any point during the nine-year economic expansion, Pimco said.

Models - Firm

“The models are flashing orange rather than red,” the firm noted.

A slowing economy will bring the U.S. growth rate closer to the stalled economies of China, Europe and Japan and limit inflation, making mortgage-backed securities an attractive alternative to investment-grade credit, Pimco wrote.

Expansion - Economy

“While the expansion has been aging gracefully, we believe the global economy...
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