Goldman Sachs raised the probability of a U.S. recession to 35% from 20% and said it expects more rate cuts by the Federal Reserve, as President Donald Trump's tariffs roil the global economy and upend financial markets.

Investment bank Goldman Sachs has warned that U.S. President Donald Trump's sweeping new tariffs may spike inflation and shrink the economy in coming months to the point of a recession.

President Trump’s escalating trade war and sliding consumer confidence has doubled the probability of a recession to 35%, according to Goldman Sachs. CNBC Senior Markets Correspondent Dominic Chu joins Chris Jansing to provide an update on how the markets are bracing for new Trump tariffs this week.

Goldman Sachs (GS) has sounded the alarm bell on the US economy ahead of President Trump's unveiling of reciprocal tariffs later this week. The takeaway? Trump's so-called "Liberation Day" package could end up liberating the inflation beast.

Goldman Sachs economists raised their forecast for Federal Reserve interest rate cuts to three this year and increased the probability of a U.S. recession to 35%, as President Donald Trump’s tariffs put pressure on economic growth.

U.S. stocks tumbled in early Monday trading, while Treasury bonds and gold rallied, as global markets reacted to President Donald Trump's threat of damaging trade tariffs, which could tip the world's biggest economy into recession over the coming months.

The prospect of a radical escalation in the global trade war in the coming days has nearly doubled the probability of a recession in the U.S. economy in the next 12 months to around 35%, according to Goldman Sachs.

The pandemic-era housing boom swelled Americans' home equity to record levels. Tapping into that could prop up the consumer and the economy in a slowdown.

Policy uncertainty is driving worries in the markets that may be increasing predictions about an incoming recession. Bill Watts, a markets editor at MarketWatch, joins CBS News with more.