Wall Street is ramping up predictions of the US plunging into recession over the next year as the global stocks rout lingers.

JP Morgan raised its chances of a recession in the world’s largest economy this year from 25pc to 35pc - and predicts there is a 45pc chance it will happen by the second half of 2025.

Economist Bruce Kasman said US news “hints at a sharper-than-expected weakening in labour demand and early signs of labour shedding”.

It follows employment data last week showed the American economy added far fewer jobs than expected, with unemployment hitting a three-year high.

All the main stock indexes on Wall Street slumped on Wednesday and many Asian markets resumed losses overnight following the global rout that wiped billions off the value of stocks.

JP Morgan warned that about a quarter of the global carry trade that was partially behind the spiralling sell-off has yet to unwind.

Meanwhile, its chief executive Jamie Dimon said he is sceptical that inflation will return to the Federal Reserve’s 2pc target amid high deficit spending and the “remilitarisation of the world”, amid threats from China and Russia.

Read the latest updates below.