Report: Economic recession coming for the U.S.

0
66
A little girl pulls out a Dora toy from the shelf at a Target store - AP image Steve Helber

A new economic analysis of the U.S. economy projects a recession around the corner.

An international nonprofit, The Conference Board, has released its Leading Economic Indicators report, which projects into the next year for the U.S. economy. That analysis, among other things, projects high inflation, high-interest rates and declining consumer spending.

“The US LEI trajectory remained negative, and its six- and twelve-month growth rates also held in negative territory in October,” Justyna Monica, senior manager, Business Cycle Indicators, at The Conference Board, said in a statement. “Among the leading indicators, deteriorating consumers’ expectations for business conditions, lower ISM® Index of New Orders, falling equities, and tighter credit conditions drove the index’s most recent decline.”

Increased federal debt spending has helped fuel the elevated inflation of recent years. Meanwhile, that inflation as well as dysfunction in Washington, D.C. around funding the government has led to an international credit downgrade of the U.S. government. In August, Fitch Ratings, one of the top three international credit rating groups in the world, downgraded the U.S. from AAA to AA+, raising concerns about federal spending, which has also helped fuel the higher interest rates.

The Conference Board report also projects a recession.

“After a pause in September, the LEI resumed signaling recession in the near term,” Monica said in a statement, adding that it will be a “very short” recession. “We forecast that real GDP will expand by just 0.8 percent in 2024.”