On Wednesday, US President Donald Trump delivered a long-awaited "Liberation Day" speech, unveiling a 10 percent baseline tariff on all US imports and "reciprocal tariffs" on scores of countries.

The "reciprocal tariffs" — highest in over a century — went as high as 34 percent on China (on top of 20 percent tariffs already in place), 20 percent on the European Union, 27 percent on India and 24 percent on Japan.

Within two days of the tariff announcement, some $6 trillion vanished from the US stock market while nearly $11 trillion has been wiped from US markets since Trump's inauguration.

Globally, nations threatened trade wars, and China retaliated with counter-tariffs on US imports.

Trump's extensive tariffs on about 180 countries have raised concerns of a US-led global recession.

On Friday, JP Morgan raised the likelihood of a US recession to 60 percent, up from 40 percent just 21 days earlier.

In a note to investors titled "There Will Be Blood", JP Morgan chief economist Michael Feroli said his firm predicted that the gross domestic product (GDP) will likely contract "under the weight of the tariffs."

Feroli cautioned: "The effect of this tax hike is likely to be magnified — through retaliation, a slide in US business sentiment, and supply chain disruptions. Disruptive US policies have been recognised as the biggest risk to the global outlook all year."

Feroli forecasts a two-quarter recession in late 2025, with GDP shrinking by 1 percent in third quarter and 0.5 percent in fourth quarter. The annual GDP for 2025 is expected to decline by 0.3 percent.

"The pinch from higher prices that we expect in coming months may hit harder than in the post-pandemic inflation spike, as nominal income growth has been moderating recently, as opposed to accelerating in the earlier episode," Feroli added.

"Moreover, in an environment of heightened uncertainty consumers may be reluctant to dip too far into savings to finance spending growth."

A 'self-inflicted economic catastrophe'

JP Morgan joins a growing list of economic analysts warning of potential recession risks.

Oxford Economics' Ryan Sweet stated that Trump's tariffs have increased the risk of a US recession.

Sweet cautioned that the economy is "dangerously vulnerable" to a recession within 12 months, as US tariff rates are poised to reach century-high levels.

EY economist Greg Daco estimated that rising import costs would lead to an annual income loss of $690, with lower-income families facing losses exceeding $1,000.

"Importantly, we stress that a significant adverse financial market reaction would exacerbate these shocks and push the US economy into a recession," Daco said.

"We now see a 40 percent-50 percent chance of a recession over the next year," American financial services firm Morningstar predicted.

Calling Trump's tariffs a "self-inflicted economic catastrophe", the firm said, "if the tariffs are maintained, the tariff hikes announced April 2 represent a self-inflicted economic catastrophe for the United States."

Other analysts have called Trump's tariffs the "biggest policy mistake in 95 years."

"Trump has officially brought the economy to its knees. The president singlehandedly wiped out Americans’ retirement savings overnight and subjected businesses to intense whiplash with his increasingly erratic and chaotic policies that continue to drive consumer and business uncertainty," said Groundwork Collaborative’s Executive Director Lindsay Owens. 

"To call this an economic downturn is an understatement; Trump is marching us straight into a depression," said Owens of the Washington DC-based public policy think-tank.

Mark Zandi, chief economist at Moody's Analytics, warned that Trump's tariffs could trigger a severe recession in the US and globally if implemented.

"If the 20 percent average tariff is imposed and kept in place for more than a few months, and US trading partners retaliate in kind, the US and global economies will not suffer a depression, but they will suffer serious recessions," Zandi cautioned.

Peter Tchir, head of macro strategies at Academy Securities told Bloomberg that "We are rapidly headed towards recession."

"The world was prepared for 'reciprocal tariffs.' Whatever the abomination that was launched at the Rose Garden was, it is a disaster — mostly for the US, but also for the global economy," Tchir added.

Warning high inflation is here to stay, Federal Reserve Chair Jerome Powell said on Friday that a trade war could lead to higher inflation and slower growth, causing more damage than anticipated.

Economists say tariffs may increase costs, reduce consumer spending, and prompt retaliatory actions, risking economic downturn or stagflation.

Trump, however, appeared defiant despite the recession fears.

On Friday, he goaded China after it retaliated against his tariffs and dismissed falling stock markets amid the trade war, calling it an opportunity to "get rich."

"China played it wrong, they panicked — the one thing they cannot afford to do!" Trump posted on Truth Social in his signature all-caps style.