The next U.S. economic recession is most likely to come in 2020, according to a survey of economists polled by the Wall Street Journal released on Thursday.
Around 59 percent of economists said the current U.S. economic expansion was most likely to end in 2020, while 22 percent predicted the next recession would arrive in 2021, the survey showed.
As for the most likely primary cause of the next recession, 62 percent of economists said the Federal Reserve raised interest rates to cool off an overheating economy. Other reasons selected by economists surveyed were a financial crisis, the bursting of an asset bubble, a fiscal crisis or disruptions to international trade.
While it's difficult to predict the specific timing of the next recession, the economic expansion will not last forever. The current economic expansion began in mid-2009 after a recession caused by the 2008 global financial crisis. It has become the second-longest economic expansion in American history.
Some Fed officials are worried that the added stimulus from 1.5-trillion-U.S. dollar tax cuts, approved by U.S. Congress last year, raised the risk that the U.S. economy could overheat in 2019 or 2020. That would force the Fed to sharply tighten monetary policy and could derail the current economic expansion.
Adam Posen, president of the Peterson Institute for International Economics, a Washington-D.C. based think tank, believed the U.S. economy would go through "another little boom and bust cycle" due to the tax cuts. He predicted that the U.S. economy will likely see another recession at the end of 2020 or early 2021.
The Fed last week kept its benchmark interest rates unchanged, while expressing its confidence that U.S. inflation had moved closer to its 2-percent target.
Economists and market participants are widely expecting that the central bank will raise rates again in its June policy meeting, the second rate hike of the year.