Citigroup Inc. Chief Executive Officer Jane Fraser says she expects a US recession at the back-end of the year, but she expects it to be manageable. She speaks to Bloomberg’s Sonali Basak the Milken Institute Global Conference in Beverly Hills, California.

Follow Bloomberg for business news & analysis, up-to-the-minute market data, features, profiles and more:
Connect with us on…
Twitter:
Facebook:
Instagram: …(read more)

BREAKING: Recession News

LEARN MORE ABOUT: Bank Failures

REVEALED: Best Investment During Inflation

HOW TO INVEST IN GOLD: Gold IRA Investing

Citigroup CEO Fraser Expects US Recession by End of Year

Citigroup CEO Jane Fraser has raised concerns over the potential of a US recession by the end of this year. Fraser, who assumed the role as the first female CEO of a major Wall Street bank in March of this year, shared her views during an interview with CNN.

Fraser expressed her belief that although the US economy is currently strong thanks to the impressive rate of COVID-19 vaccinations and the unprecedented fiscal and monetary support from the government, there are still warning signs that indicate a looming downturn. She specifically pointed out the potential impact of inflation, labor market instability, and the ongoing COVID-19 Delta variant surge as factors that could contribute to an economic slowdown.

While Fraser acknowledges that the US economy has been recovering well from the pandemic-induced recession, she cautions against being complacent about the possibility of another downturn. “The scale of the fiscal response in the United States, the liquidity that has been pushed in, is extraordinary,” she said. “But we must be on guard because some of these things can trigger unintended consequences.”

One of the primary concerns Fraser mentioned was the rising inflation rate. The US has experienced a surge in prices recently, with consumer prices increasing at their fastest pace in over a decade. This has raised fears of prolonged inflation, which could potentially lead to the Federal Reserve tightening monetary policy by raising interest rates. Such a move could negatively impact businesses as borrowing costs increase.

Fraser also emphasized the uncertain state of the labor market. While the US has made significant progress in reducing unemployment levels, there are still challenges in terms of workforce participation and skill mismatches. The CEO believes that these issues could further strain economic growth and potentially contribute to a recession.

In addition to inflation and employment concerns, the Delta variant of COVID-19 poses a significant threat to the US economy. The recent surge in cases has already led to a slowdown in some sectors, including the travel and hospitality industries. If the Delta variant continues to spread rapidly and substantial lockdown measures are reinstated, it could dampen economic growth and potentially push the country into a recession.

Although Fraser’s outlook sounds concerning, it is essential to remember that these are her opinions and predictions. Economists and experts have differing views on the future of the US economy. Additionally, economic forecasting is a complex task that often involves numerous variables and uncertainties.

Nevertheless, Fraser’s warning serves as a reminder that despite the remarkable strides made in recovering from the pandemic-induced recession, challenges and risks still persist. It underscores the importance of remaining vigilant, monitoring economic indicators, and taking appropriate measures to mitigate potential downturns.

It remains to be seen whether Fraser’s prediction comes to fruition. As the global economy navigates through the ongoing recovery process, the collective efforts of policymakers, businesses, and individuals will play a crucial role in shaping the future trajectory of the US economy.