Fitch Warns AI Market Correction Could Trigger US Recession

Fitch Ratings warns that a sharp reversal in AI investment and equity markets could cause a major economic shock, potentially pushing the US into recession by 2027. Their scenario models a 35% drop in US equities and a 15% fall in non-US equities, leading to a 0.6% GDP contraction. The AI boom currently supports US growth, but high valuations and uncertain future profits pose risks to investment and consumer demand.

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