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U.S. executives expect a recession

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US business leaders are less and less optimistic about the state of the US economy. According to a recent survey, CEOs are increasingly assessing the state of the economy and more than half of them expect a recession.

American businessmen expect a recession

We regularly alert to the threat of recession. According to a recent American Survey Conference Board in the second quarter of this year, the confidence of CEOs of American companies fell for the fourth consecutive quarter. The confidence level is now 42 points, down from 57 points in the first quarter, which is again a level that has not been recorded since the onset of the COVID-19 pandemic.

More and more CEOs loses confidence in the US economy and evaluates it critically. Nearly 60% of CEOs surveyed expect inflation to fall in the coming years, but at the same time, CEOs believe raising interest rates by the Fed will cause a brief recession. Sixty-one percent of CEOs said that economic conditions are worse than six months ago, compared to 35% in the first quarter. Thirty-seven percent of CEOs said conditions in their own industry are worse than they were six months ago, up from 22% in the first quarter.

U.S. executives expect a recession
Decline in the confidence of American directors in the American economy. Source: Investopedia

People are starting to save

According to the editor-in-chief of Investopedia Caleb Silver consumers are beginning to move into a saving regime, which will further negatively affect business prices and the sector as a whole, as entrepreneurs are currently shifting the burden of inflation to consumers:

“Companies have so far managed to pass on the rising costs to consumers, but there will be a turning point when consumers are reluctant to spend on anything other than basic needs. Rising credit card balances predict this slowdown and consumers are likely to tighten their wallets as interest rates rise.”

There are no positive signals for global markets in the state of the US economy and in the monetary policy of the US Federal Reserve. It is expected in the future further increase in interest rates by the Fed which may exacerbate negative sentiment in markets and the business sector.

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