.Sergio Ermotti, ceo of UBS GroupStefan Wermuth|Bloomberg|Getty ImagesZURICH, Switzerland Double A u00b7 UBS CEO Sergio Ermotti said Wednesday that market dryness might boost in the 2nd half of the year, however he does not believe the U.S. is heading into a recession.Global equities viewed stinging auctions last week as entrepreneurs digested weak economic records away from the united state which raised anxieties concerning an economical slump in the world's biggest economic climate. It additionally questioned regarding whether the Federal Get needed to have to be less hawkish along with its own monetary plan position. The central bank maintained prices on grip in overdue July at a 23-year high.When inquired about the overview for the U.S. economic situation, Ermotti pointed out: "Certainly not necessarily an economic crisis, however absolutely a stagnation is actually feasible."" The macroeconomic indications are actually not clear sufficient to discuss economic slumps, and actually, it is actually probably untimely. What we understand is that the Fed possesses sufficient capability to step in as well as support that, although it is actually heading to take a while, whatever they do to be after that sent in to the economic climate," the CEO said to CNBC on Wednesday after the financial institution stated its second-quarter results.UBS expects that the Federal Reserve will definitely reduce prices through at least 50 basis points this year. Currently, traders are split in between a 50 and also a 25 basis aspect cut at the Fed's upcoming appointment in September, according to LSEG data.Speaking to CNBC, Ermotti stated that our team are very likely to view much higher market dryness in the 2nd fifty percent of the year, partly as a result of the U.S. political election in November." That is actually one factor, however also, if I examine the general geopolitical photo, if I take a look at the macroeconomic photo, what we observed in the final number of full weeks in relations to volatility, which, in my viewpoint, is a clear indicator of the frailty of some factors of the system, u00e2 $ u00a6 one ought to expect undoubtedly a higher level of volatility," he said.Another unpredictability going ahead is monetary policy and whether central banks will definitely have to reduce rates much more boldy to deal with a slowdown in the economic condition. In Switzerland, where UBS is headquartered, the central bank has actually reduced costs two times this year. The European Reserve Bank as well as the Financial Institution of England have each declared one cut thus far." Recognizing the occasions which are theu00c2 unknowns at hand like the USA presidential election, we ended up being complacent along with a quite low dryness, now our team are switching to a more regular routine," Bruno Verstraete, founder of Lakefield Wide range Administration informed CNBC Wednesday." In the context of UBS, [more dryness is actually] certainly not automatically a poor trait, given that additional dryness means even more exchanging earnings," he incorporated.