Economists assess that the possibility of a recession in the United States has greatly increased
Economists believe that the possibility of a recession in the United States has greatly increased, with the possibility of a recession in the next 12 months reaching 44%.
The annual growth rate of the consumer price index in the United States climbed to a 40-year high of 8.6% in May this year, indicating that the pressure of rising prices is intractable, forcing the Federal Reserve to announce last week the highest rate hike in 28 years. Dozens of economists interviewed believe that the possibility of a recession in the United States has greatly increased, with the possibility of a recession in the next 12 months reaching 44%. In the last survey conducted by
in April, economists on average believed that the probability of the economy entering into recession in the next 12 months was 28%, compared with only 18% in January. Since they started doing this survey in 2005, they have rarely seen a recession expectation rate of 44%.
What we did in December 2007 later encountered the financial tsunami in 2008. At that time, the probability of recession given by economists was only 38%.
Experts have raised the possibility of recession this time due to multiple factors, including rising borrowing costs, accelerating inflation, supply chain problems and the impact of commodity prices caused by the Russia-Ukraine war. In addition, most experts also believe that it is increasingly unlikely that the Federal Reserve will raise interest rates again in order to curb inflation while avoiding an increase in unemployment and an economic recession.
U.S. Treasury Secretary Yellen html said on the 19th that prices may remain unacceptably high before the end of the year, and she expected the U.S. economy to slow down; Cleveland Federal Reserve President Mester said that the U.S. economy is in recession. Risks are rising, and it will take two years for inflation to fall back to the Fed's 2% target.
Yellen said on ABC : Inflation has been very high this year and will remain high before the end of the year. I expect the economy to slow down, but I don't think a recession is entirely inevitable.
The annual growth rate of the U.S. consumer price index in May reached 8.6%. This figure that measures inflation hit a 40-year high, indicating that price pressure is impacting the economy. It also prompted the Federal Reserve to announce a 3-point interest rate hike last week, the highest rate since 1994. maximum amplitude.
Yellen said that the reasons for the high level of inflation are global rather than local. Energy supply interruptions caused by the war in Ukraine and exports blocked by the implementation of epidemic prevention and control measures are unlikely to subside immediately.
Yellen also said that the tariffs on some Chinese goods that have been in place since the Trump administration have lost their strategic purpose, and that President Biden is re-examining these tariffs in the hope of reducing inflation.
She said: "We all agree that our country is pursuing a series of unfair trade practices. This issue is very important, but some of the tariffs we have adopted today have lost their strategic purpose and will increase costs for consumers." However, Yellen It did not list any specific tariff items and declined to say when the Biden administration would make a decision.
Cleveland Fed President Mester echoed Yellen's sentiments, saying that U.S. economic growth will slow down and the threat of recession will increase. She believes it will take two years for inflation to fall back to the 2% target.
Mester said on the 19th: The risk of recession is rising, partly because monetary policy should have turned earlier.
Mester reiterated that she was not predicting a recession, but she said the Fed's delay in raising interest rates was hurting the economy. She said the Fed will have to see monthly data showing that price pressures are easing before it can believe that prices are under control.
On the other hand, White House Economic Advisor Dees is more optimistic about the U.S. economy than Yellen. He predicts that inflation will begin to ease this year. He hopes that Congress will pass measures to help combat inflation, including lowering prescription drug prices, Provide energy tax incentives and other measures to reduce people's financial pressure.
