After the Federal Reserve hiked interest rates to fight inflation, some experts wondered if the economy was heading into another recession.
The Senate Finance Committee heard testimony from the Secretary of the Treasury. The photo was taken by Alex Wong.
The economy is expected to slow due to the recovery of the labor market from the Covid-19 pandemic, according to Federal Reserve Chair Janet Yellen.
Inflation is unacceptably high after consumer prices jumped 8.6% year-over-year last month.
According to the Federal Reserve Chair, his goal is to bring down inflation while maintaining a strong labor market.
She doesn't think a recession will follow Powell's goal.
In February 2020 economists assigned a 26% probability, after the Journal surveyed economists who put the probability at 38%. A Conference Board survey found that 76.1% of top C-suite executives think there will be a recession by the end of the year.
The Federal Open Markets Committee decided to raise the federal rate funds by 0.75 percentage points in order to fight inflation. The uncertainty surrounding a possible recession reached a feverish pitch last week when all major stock indexes plunged into bear market territory. Since the beginning of the year, the S&P 500 is down 18% and the U.S. GDP is contracting. Biden said in an interview with the Associated Press that a recession is not inevitable.
The Fed plays a dangerous game with inflation and rate hikes.
Experts worry that the fight against inflation will cause a recession.
According to a survey, most CEOs think a recession will happen next year.
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