There have been a growing number of economists and analysts that are predicting that the US is heading towards a recession. The consumer price index soared highest in 40 years in early June. The government’s primary inflation gauge surged 8.6% for the past year. The Fed is aggressively raising interest rates in response to slowing down economic activity.
Signs of an economic downturn are showing up in every sector from commodities to housing. Copper prices, used as a gauge for the market, dropped to 16-month lows on Thursday by 11%. S&P Global Market Intelligence reported the purchase of non-essential goods due to rising prices. Also, according to the survey conducted by the University of Michigan soaring inflation, a bear market, and the rising interest rate has soured consumer sentiment to a record low.
However, experts remain hopeful that a slow-down in the housing market would not hurt the economy as the housing bubble burst of 2008 did. Banks remain cautious of lending out loans to people with no or bad credit.
