Fed staff expects banking crisis to cause a recession this year [View all]
Source: ABC News
The Federal Reserve's staff is more worried about the U.S. economy tipping into a recession after the recent banking crisis, the minutes from the central bank's meeting in March reveal.
Economists at the Federal Reserve said they expect a "mild" recession later this year, an escalation from their previous assessment.
"Given their assessment of the potential economic effects of the recent banking-sector developments, the staff's projection at the time of the March meeting included a mild recession starting later this year, with a recovery over the subsequent two years," according to the publicly posted minutes from the meeting, which took place over March 21-22 right after the collapse of Silicon Valley Bank and Signature Bank.
The comments from economists on staff within the Federal Reserve reflect a dimmer outlook than public statements from Chairman Jerome Powell, who said after that March meeting "we don't know" whether there will be a recession.
Read more: https://abcnews.go.com/Politics/fed-staff-expects-banking-crisis-cause-recession-year/story?id=98540661
As far as politics goes, it is better to have a recession this year rather than next year when President Biden is up for reelection.
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