Goldman Sachs Predicts U.S. GDP to Shrink 5% in Second Quarter

The U.S. economy will contract sharply in late March and April as consumers and businesses slash spending, with the short downturn likely be officially deemed as being a recession, according to Goldman Sachs Group Inc.

The world’s largest economy will shrink 5% in the second quarter after zero gross domestic product growth in the first three months of the year, the firm’s economists wrote in a note Sunday. They cut their full-year forecast to 0.4% growth from 1.2% on expectations for growth of 3% and 4% in the third and fourth quarters and strong gains in early 2021.