A Nasty Recession Is Coming – Here Are Signs That Economic Problems Are Getting Worse

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In an effort to lower inflation, the Federal Reserve has increased interest rates a whopping 10 times since March 2022. Over the period, inflation hit 9.1% in June 2022 – its highest point since 1982. In the latest inflation report, the inflation appears to have slowed down – recording 5.3% in May 2023, compared to 5.5% in April. This will reduce pressure for more interest rate hikes.

However, excluding volatile food and energy prices, the picture isn’t as optimistic. While food prices rose just 0.2%, it was mostly due to a 3.6% slice in energy prices. A 0.6% increase in shelter prices was a major contributor to the CPI reading. Used vehicle prices increased 4.4% and transportation services were up 0.8%. Crucially, the inflation continues to outpace wage gains for the 26th straight month.
 
While the Joe Biden administration wants the world to believe that the U.S. will not plunge into recession, a lot of experts have been saying that economic conditions are likely to start deteriorating later in the year. In short, only politicians believe a recession will not happen. Economic experts are ringing the alarm bells over an imminent recession, predicted to start in the second half of 2023.

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