skip to log on skip to main content
VoiceOver users please use the tab key when navigating expanded menus
Article related to:

Economy

Are US recession concerns overblown?

Chief Economist, ANZ

2022-07-12 00:00

It wasn’t hard to figure out what was top of mind in the business and investment community on my recent trip to Singapore. In order, it would be the potential for a US recession, a US recession, and a US recession.

I’m not overstating this. It came up in every meeting I had.

Some raised it as a genuine question, but really, many have already formed their own view. And that view seems to be the US is going to have a nasty tumble over the next year or two, largely due to the impact of rising interest rates.

I don't agree with that.

A technical recession? Maybe. Probably, even. But for me, the more pertinent question is: will it be a deep recession or not? And I don't see a strong case for a deep recession in the US. The panic, in my opinion, is premature.

{video}

Surprisingly, China’s structural slowdown and the tectonic implications of climate change were of less focus.

Most of the focus is on lockdowns and what that means for the economy in the short term. But what many are missing is the data which suggest economies that experience lockdowns tend to see sharp falls in birth rates.

For China, now battling through lockdowns for more than two years, that's an important structural development – and one I think worth paying more attention to.

On climate, there is a sense, I think, of people treating the impact of the crisis in Europe as a bit of a one-off event. But the real lesson is the vulnerability of the global system to these sorts of disruptions.

We’ll see many other potential sources of disruption as we go through this difficult, multi-decade balancing act around shifting the climate.

And we need to think more about that.

Richard Yetsenga is Chief Economist at ANZ

anzcomau:article-hub/topic/economy
Are US recession concerns overblown?
Richard Yetsenga
Chief Economist, ANZ
2022-07-12
/content/dam/anzcom/images/article-hub/articles/institutional/2022-03/generic-blue-buildings.jpg

 

Sign up
Icon of ANZ logo coming out of an envelope

Receive insights direct to your inbox

 

Related articles

This publication is published by Australia and New Zealand Banking Group Limited ABN 11 005 357 522 (“ANZBGL”) in Australia. This publication is intended as thought-leadership material. It is not published with the intention of providing any direct or indirect recommendations relating to any financial product, asset class or trading strategy. The information in this publication is not intended to influence any person to make a decision in relation to a financial product or class of financial products. It is general in nature and does not take account of the circumstances of any individual or class of individuals. Nothing in this publication constitutes a recommendation, solicitation or offer by ANZBGL or its branches or subsidiaries (collectively “ANZ”) to you to acquire a product or service, or an offer by ANZ to provide you with other products or services. All information contained in this publication is based on information available at the time of publication. While this publication has been prepared in good faith, no representation, warranty, assurance or undertaking is or will be made, and no responsibility or liability is or will be accepted by ANZ in relation to the accuracy or completeness of this publication or the use of information contained in this publication. ANZ does not provide any financial, investment, legal or taxation advice in connection with this publication.

Top