Financial experts still expect recession this year despite easing inflation

Since March 2022, the Federal Reserve has raised its benchmark borrowing rate seven times, and despite signs of inflation beginning to moderate, more rate increases are likely on the horizon, Federal Reserve Governor Michelle Bowman said Jan. 12.

Economists are expecting those rising interest rates to push the U.S. into a recession in the next 12 months, according to a The Wall Street Journal survey of 71 economists. However, most expect it to be relatively mild and short-lived.

Despite what the Fed has signaled, 51 percent of the survey's respondents said they expect the central bank to start cutting rates in 2023.

Experts are expecting GDP to stagnate, with a projected growth rate of 0.4 percent for 2023, the report said. Employers may start cutting jobs as soon as the second quarter, with an expected loss of 7,000 jobs per month, on average.

Most respondents said the hardest categories of inflation to quell in 2023 will be housing, healthcare and personal services, the report said.

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