Connect with us

Hi, what are you looking for?

Top News

Deutsche Bank predicts deep recession in US – Pulse Business

Deutsche Bank predicts deep recession in US - Pulse Business

Deutsche Bank economists predict that the central bank will decide to continue the most aggressive monetary tightening in the United States since the 1980s, a side effect of the deepening recession in the U.S. economy next year, Bloomberg reports.

– We are conservative of the Fed raising the funding ratio to 5-6%. According to a Deutsche Bank report released on Tuesday, this method will be sufficient to achieve the desired goal. – This is possible because the process of monetary tightening will be accompanied by a reduction in the central bank balance, which, according to our panel of economists dealing with the United States, will be equivalent to several additional interest rate hikes by 25 percentage points. . Basic – he adds.

Deutsche Bank economists expect the central bank’s actions to have a financial impact “that will push the economy into a significant recession by the end of next year.” They predict that this will lead to an increase in unemployment by “a few percentage points”.

Photo by Bloomberg

Bloomberg recalls that Deutsche Bank was more optimistic about the future of the US economy than other major financial institutions. He was the first to predict a recession in the US economy in response to the start of the central bank’s rate hike. Goldman Sachs estimates its probability at 35 percent. In the next two years. The Bloomberg Economics model shows that 44 percent. During the period ending January 2024.

Deutsche Bank economists say raising the central bank’s core rate to a neutral value, which means it will not accelerate or slow growth, is estimated by the central bank to be 2.5%, which will have no effect in the form of a fall. Swelling. Deutsche Bank believes the neutral rate is around 5 percent. And USD expects a 4.5-5.0% increase in 10-year bond yields.

See also  United States. Donald Trump is no longer on the rich list

“We will have a major recession, but we are confident that the sooner the central bank acts, the less damage it will do to the economy,” the Deutsche Bank report said.

©

Click to comment

Leave a Reply

Your email address will not be published.

You May Also Like

Tech

Another person familiar with Sony’s plans confirms the killer news for PS5 owners. Horizon Forbidden West is not expected to appear on the market...

Economy

It looks like Tesla wants to use lasers instead of standard wipers in the future. I applied for a patent for this solution. The...

World

The British government has canceled a recommendation to avoid travel to and from the eight regions most affected by the Indian coronavirus variant altogether....

Economy

Farmer reveals government plans for CPK The farmer who issued the documents is a member of the social council of the CPK. As he...