Minutes from the latest Federal Open Market Committee (FOMC) policy meeting revealed that the policy-making arm of the central bank believes the odds of a recession occurring in 2023 are higher.
While inflation is moderating and global economic growth prospects have bolstered market sentiment, there is a growing number of FOMC participants who are anticipating “subdued growth or a mild recession” this year. But there are still “notable uncertainties ahead,” such as the potential for persistent inflation and the possibility of “a deeper downturn.”
According to the minutes, participants acknowledged that inflation had eased in the last three months, but they purported that they needed to see more progress. In addition, the rate-setting committee members warned that a prolonged tightness in the labor market would add to upward inflation pressures….