The growth prospects continue to deteriorate the risk of decline in the US economy

Xinhua News Agency, Washington, July 12 (International Observation) The growth prospects continue to deteriorate the risk of decline in the US economy

Xinhua News Agency reporter Xiong Maoling

The International Monetary Fund issued the latest forecast on the 12th, which reduced the expected to US economic growth in 2022 to 2.3%. It is believed that the United States is increasingly challenging to avoid economic recession. This is the second time the agency has lowered the expectations of US economic growth within a month, highlighting the deterioration prospects of US economic growth. Some economists believe that in the context of continuous high inflation and accelerating the Federal Reserve's accelerated interest rate hikes, the US economy is frequent "yellow lights", and decline is only a matter of time.

The recession comes in advance?

The latest forecast announced by the Atlanta Federal Reserve Bank on the 8th shows that in the second quarter of this year, the actual GDP (GDP) in the second quarter of this year (GDP) was calculated by an annual rate of 1.2%. The final correction data released by the US Department of Commerce at the end of June showed that the data fell by 1.6%in the first quarter of this year. If predicting becomes a reality, it means that the US economy has fallen into a technical recession.

This is the US Department of Commerce, which was taken in Washington, USA on April 28. (Photo by Liu Jie, a reporter from Xinhua News Agency)

Caishaw Wood, the founder and CEO of the Ark Investment Company, said in an interview with the US Consumer News and Business Channel that she believes that the US economy is in a decline. I have never seen in my career.

Economist Destmond Rachman, an economist of the American Enterprise Research Institute, told Xinhua News Agency that the US economic recession will come earlier. In the second quarter, the US economy is likely to have negative growth, while negative growth in two consecutive quarters meets the general definition of economic recession.

Rahman also said that as an authoritative agency that judged the economic recession of the United States, the National Economic Research Institute usually had to be officially judged after several months of measurement. In the short term, it may not be eager to declare that the US economy has fallen into decline.

"Yellow Lantern" with frequent economy

According to data released by the American Supply Management Society earlier this month, in the context of the continuous supply chain bottleneck and high inflation, the US manufacturing procurement manager index in June decreased by 3.1 percentage points compared with May, showing that the growth of the manufacturing industry slowed down. The inventory of some industries is very high, and sales are declining.

On June 14, in Washington, USA, a man walked from a food supermarket under a shopping bag. (Shin of Xinhua News Agency, Photo Shen Ting)

About 70 % of the personal consumption expenditure of about 70 % of the US economy also has a risk signal. According to data from the US Department of Commerce, the US personal consumption expenditure in May only increased by 0.2%, and it decreased after the adjustment was adjusted.

The Wall Street Journal reported that the American people were facing the worst inflation situation in the past decades, but their income failed to keep up with the pace of price increases and affected consumer expenditure.

An analysis article by the Institute of International Economics of the U.S. Think Tank's Institute of International Economics believes that the US employment market is relatively strong in June, but the labor participation rate has declined. Outside the labor market, other economic data are worrying, showing that the economy may decline.

Worrying generally heating up

Many economists believe that in the context of high inflation, the Federal Reserve ’s more radical monetary policy has pushed the US economy into decline. The Federal Reserve Chairman Powell in late June was acknowledged that there was a possibility of recession in the US economy and realizing soft landing will be very challenging.

This is the Federal Reserve building taken in Washington, USA on June 22. (Photo by Liu Jie, a reporter from Xinhua News Agency)

Since March, the Federal Reserve has raised interest rates three times, raising the federal fund interest rate target range to 1.5%to 1.75%. At the Monetary Policy Conference in June, the Federal Reserve raised interest rate hikes 75 basis points, which was the largest single interest rate hike since 1994, and its urgency of controlling inflation is evident.

Adam Poson, director of the Peterson Institute of International Economics, told a reporter from Xinhua News Agency that if the interest rate level at the end of the rate hike cycle at the end of the round of this round was adjusted from about 3%to more than 4%, it may bring economic recession.

Deutsche Bank economists have recently predicted that the US economy will begin to fall into recession in mid -2023, and the unemployment rate will reach 5.4%in the fourth quarter of 2023. The British "Financial Times" survey shows that nearly 70%of the economicists in the United Kingdom believe that the US economist will fall into a decline next year. According to the prediction released by the Bloomberg Society's Ministry of Economic Affairs in mid -June, the US economy is likely to 72%of recession by 2024.

Rahman told reporters that the US economic recession has a very high probability of economic recession in the economic slowdown and tough Fed's policy stance. The two -year and 10 -year U.S. Treasury yields have reappeared, which is a very reliable forward -looking indicator for economic recession.

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