The US economy is under severe inflationary pressure, which increases recession risks for the world’s largest economy. In the current situation, rising prices call the American economy’s prospects into question.
“The US economy is starting to show signs of strain under the weight of decades-high inflation and climbing interest rates - raising the risk of a downturn,” Rich Miller at Bloomberg reported. Falling revenues of major US retailers such as Walmart Inc. and Target Corporate as well as the ongoing 2-week long slump in the equities market, suggest that recession is looming on the horizon. Record high household debt, worsening outlooks for the real estate market caused by high mortgage rates, and rising expenditures and labor costs for mid-cap businesses are also a matter of concern.
“I would put the odds of a recession beginning in the next 12 months at about 1 in 3, and probably close to even odds over the next couple of years,” Mark Zandi, chief economist at Moody’s Analytics said.
