US faces ‘L-shaped’ recession as Fed scrambles to tame inflation: analyst
The US economic system will probably have to remain in recession for longer than anticipated so as to convey runaway inflation below management, in accordance with a high analyst.
Zoltan Pozsar, the worldwide head of short-term rate of interest technique at Credit score Suisse Group AG, wrote a consumer notice pushing again on widespread sentiment that the worst of inflation could also be behind us and that the Federal Reserve will start decreasing rates of interest.
As an alternative, the US might should gird for a so-called “L-shaped” recession that shall be deeper and longer than anticipated, in accordance with Pozsar.
Pozsar cited the continuing Russian invasion in Ukraine in addition to disruptions to the provision chain exacerbated by intermittent COVID-related lockdowns in China.
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