Despite consistent recession predictions from billionaire investors, Wall Street analysts, and even former Federal Reserve officials for over a year now, the U.S. economy has proved to be incredibly resilient. The unemployment rate remains near record lows at 3.6%, and the Atlanta Fed estimates GDP grew 1.5% in the first quarter. But Gregory Daco, chief economist at EY-Parthenon, warned this week that a combination of factors in the wake of the recent banking crisis will “weigh on” the economy in the coming months.
“The economy is unwell. It’s not the flu, but it is a throat ache,” he wrote in a Wednesday research note. Citing stubborn inflation, high interest rates, and a reduction in the availability of loans for businesses and consumers, he added that “it could get worse before it gets better” and his firm continues to project a midyear recession.
