.Sergio Ermotti, ceo of UBS GroupStefan Wermuth|Bloomberg|Getty ImagesZURICH, Switzerland u00ea u00b7 UBS chief executive officer Sergio Ermotti pointed out Wednesday that market volatility might boost in the second fifty percent of the year, yet he performs certainly not strongly believe the united state is heading in to a recession.Global equities found sharp sell-offs last week as investors digested unstable economic data away from the USA which increased worries about a financial recession worldwide's biggest economic situation. It additionally raised questions concerning whether the Federal Reserve required to become less hawkish along with its financial policy stance. The reserve bank always kept costs on hold in overdue July at a 23-year high.When inquired about the overview for the U.S. economy, Ermotti said: "Not always an economic downturn, but undoubtedly a stagnation is actually achievable."" The macroeconomic red flags are unclear sufficient to discuss recessions, as well as really, it's possibly untimely. What we understand is that the Fed has good enough capability to come in and also support that, although it is actually visiting require time, whatever they carry out to be then transferred right into the economy," the CEO said to CNBC on Wednesday after the financial institution stated its own second-quarter results.UBS counts on that the Federal Book are going to reduce costs by a minimum of 50 manner aspects this year. Right now, traders are divided in between a 50 as well as a 25 manner aspect cut at the Fed's upcoming appointment in September, according to LSEG data.Speaking to CNBC, Ermotti pointed out that our company are actually likely to observe higher market volatility in the 2nd half of the year, somewhat because of the USA election in Nov." That is actually one element, yet likewise, if I check out the overall geopolitical photo, if I check out the macroeconomic image, what our experts found in the final couple of full weeks in regards to dryness, which, in my viewpoint, is a very clear indication of the fragility of some components of the system, u00e2 $ u00a6 one ought to expect undoubtedly a higher level of volatility," he said.Another anxiety going ahead is actually monetary policy as well as whether central banks are going to have to cut prices much more aggressively to cope with a stagnation in the economy. In Switzerland, where UBS is actually headquartered, the reserve bank has reduced rates twice this year. The International Reserve Bank and the Banking Company of England possess each announced one slice up until now." Recognizing the occasions which are actually theu00c2 unknowns at hand like the united state governmental election, our company came to be contented along with a very reduced dryness, right now our company are actually moving to a more normal regimen," Bruno Verstraete, creator of Lakefield Wide range Control informed CNBC Wednesday." In the situation of UBS, [additional dryness is actually] certainly not essentially a poor trait, considering that even more dryness suggests additional investing income," he included.