NEW YORK, Sept 8 (Reuters) - The U.S. economy has only a 25 percent chance of a double-dip recession, and only a major negative shock could cause such an event, Bank of America's investment banking chief said on Wednesday.
'We have a 25 percent chance of a double-dip recession,' Thomas Montag, Bank of America Merrill Lynch's president of global banking and markets, said during a presentation to investors.
A double-dip recession would result only from 'another outsize negative shock' to the economy, he said.
Montag's remarks referenced a Sept. 3 Merrill Lynch report from the firm's head of North America Economics, Ethan Harris.
'The slowdown in the job market and the coming fiscal tightening suggest weak growth is here to stay' in the United States, Harris wrote.
But 'we still see only a 25 percent probability of an outright recession in the next year, which is slightly above the historical average,' the report said.
Montag joined Merrill Lynch in 2008 after 22 years at Goldman Sachs Group Inc. He addressed investors and executives on Wednesday at the beginning of Bank of America Merrill Lynch's annual Australia Investment Conference in New York.
Bank of America shares were up 1.6 percent at $13.42 in late-morning trading.
(Reporting by Maria Aspan; Editing by Maureen Bavdek and John Wallace) Keywords: BANKOFAMERICA/ECONOMY (maria.aspan@thomsonreuters.com; +1 646 223 6394) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
'We have a 25 percent chance of a double-dip recession,' Thomas Montag, Bank of America Merrill Lynch's president of global banking and markets, said during a presentation to investors.
A double-dip recession would result only from 'another outsize negative shock' to the economy, he said.
Montag's remarks referenced a Sept. 3 Merrill Lynch report from the firm's head of North America Economics, Ethan Harris.
'The slowdown in the job market and the coming fiscal tightening suggest weak growth is here to stay' in the United States, Harris wrote.
But 'we still see only a 25 percent probability of an outright recession in the next year, which is slightly above the historical average,' the report said.
Montag joined Merrill Lynch in 2008 after 22 years at Goldman Sachs Group Inc. He addressed investors and executives on Wednesday at the beginning of Bank of America Merrill Lynch's annual Australia Investment Conference in New York.
Bank of America shares were up 1.6 percent at $13.42 in late-morning trading.
(Reporting by Maria Aspan; Editing by Maureen Bavdek and John Wallace) Keywords: BANKOFAMERICA/ECONOMY (maria.aspan@thomsonreuters.com; +1 646 223 6394) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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