United States President Joe Biden held a meeting with top lawmakers at the Oval Office, on Tuesday (May 9) in a bid to break a deadlock over raising the $31.4 trillion debt limit, as the country faces the risk of an unprecedented default. After the high-stakes meeting, Republican House Speaker Kevin McCarthy said that there was no new “movement” which&nbsp;essentially indicated that no agreement was reached.&nbsp;

The meeting was also attended by Senate Republican leader Mitch McConnell and the top Democrats in Congress, House Minority Leader Hakeem Jeffries and Senate Majority Leader Chuck Schumer.&nbsp;

Treasury Secretary Janet Yellen warned that Washington could run short of cash to pay all of the government’s bills as soon as June without a debt limit increase. The top lawmakers will continue talks on Friday.&nbsp; 
 
The high-stakes meet 
 
The high-stakes meeting between lawmakers lasted about an hour, while the aides may continue negotiations as soon as Tuesday night on the federal budget. Biden called the meeting “productive” while McCarthy said, “I didn’t see any new movement”.&nbsp;

“Everyone in the meeting understood the risks of default,” said the US president, adding that the House speaker, during the meeting said, that the country will not default on its debt. “We need to take the threat of default off the table,” said Biden after the meeting, adding that default “is not an option”.&nbsp;

McCarthy, after the meeting talking to reporters and seemingly complaining about the US president said that Biden did not agree to talks until time was running out and, “That’s not a way to govern.”&nbsp;

Furthermore, Schumer, a Democrat, blamed McCarthy for refusing to take default off the table and that the House speaker was “greatly endangering America.” While Jeffries said Republicans had waited for weeks to publish a budget and that “extreme” Republicans “have indicated that they are willing to take us down the path of default.”

On the other hand, McConnell blamed Biden for not being serious about negotiations.

What are Biden’s options now?

According to reports, officials in the White House have discussed whether Biden has the authority to lift the debt limit by invoking the 14th Amendment of the US Constitution, on his own. However, in an interview, last week the US president said that they are not there yet.&nbsp;

Republican-led House&nbsp;

The Republican-led House of Representatives passed a bill, in April, that would raise the debt ceiling in exchange for budget cuts to healthcare for the poor, transportation, and so on. The bill would implement $4.5 trillion in spending cuts in exchange for a $1.5 trillion increase in the US debt limit.&nbsp;

However, it is very unlikely to pass the Democrat-controlled Senate while the White House has previously said that the president would veto the legislation.&nbsp;

Notably, as the speaker of the House McCarthy has primary control over US budget issues and Biden has said he would not accept these deep cuts, the impasse has raised the possibility of Congress and the White House overseeing the first national debt default.&nbsp;

Biden might cancel Asia trip

After the meeting, Biden indicated that he might cancel his upcoming trip to Asia for Group of Seven (G7) meetings. When asked about the meetings, he said that it is “possible” that he would not make the trip, “If somehow we got down to the wire and still haven't resolved this... I would not go,” the US president told reporters, as quoted by news agency AFP.&nbsp;

Yellen’s warning

In a letter addressed to the House speaker and other lawmakers&nbsp;earlier this month, Yellen had warned, “Our best estimate is that we will be unable to continue to satisfy all of the government's obligations by early June, and potentially as early as June 1, if Congress does not raise or suspend the debt limit before that time.”

She added, “It is impossible to predict with certainty the exact date when Treasury will be unable to pay the government’s bills, and I will continue to update Congress in the coming weeks as more information becomes available.”

Yellen has also recently&nbsp;said that unless Congress acts in the coming weeks, “financial and economic chaos would ensue.” If the debt ceiling is not raised or suspended by Congress the government risks defaulting on payment obligations which would have a significant impact on the US economy.

(With inputs from agencies)&nbsp; 
 
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United States President Joe Biden held a meeting with top lawmakers at the Oval Office, on Tuesday (May 9) in a bid to break a deadlock over raising the $31.4 trillion debt limit, as the country faces the risk of an unprecedented default.

United States President Joe Biden held a meeting with top lawmakers at the Oval Office, on Tuesday (May 9) in a bid to break a deadlock over raising the $31.4 trillion debt limit, as the country faces the risk of an unprecedented default. After the high-stakes meeting, Republican House Speaker Kevin McCarthy said that there was no new “movement” which essentially indicated that no agreement was reached. The meeting was also attended by Senate Republican leader Mitch McConnell and the top Democrats in Congress, House Minority Leader Hakeem Jeffries and Senate Majority Leader Chuck Schumer. Treasury Secretary Janet Yellen warned that Washington could run short of cash to pay all of the government’s bills as soon as June without a debt limit increase. The top lawmakers will continue talks on Friday. The high-stakes meet The high-stakes meeting between lawmakers lasted about an hour, while the aides may continue negotiations as soon as Tuesday night on the federal budget. Biden called the meeting “productive” while McCarthy said, “I didn’t see any new movement”. “Everyone in the meeting understood the risks of default,” said the US president, adding that the House speaker, during the meeting said, that the country will not default on its debt. “We need to take the threat of default off the table,” said Biden after the meeting, adding that default “is not an option”. McCarthy, after the meeting talking to reporters and seemingly complaining about the US president said that Biden did not agree to talks until time was running out and, “That’s not a way to govern.” Furthermore, Schumer, a Democrat, blamed McCarthy for refusing to take default off the table and that the House speaker was “greatly endangering America.” While Jeffries said Republicans had waited for weeks to publish a budget and that “extreme” Republicans “have indicated that they are willing to take us down the path of default.” On the other hand, McConnell blamed Biden for not being serious about negotiations. What are Biden’s options now? According to reports, officials in the White House have discussed whether Biden has the authority to lift the debt limit by invoking the 14th Amendment of the US Constitution, on his own. However, in an interview, last week the US president said that they are not there yet. Republican-led House The Republican-led House of Representatives passed a bill, in April, that would raise the debt ceiling in exchange for budget cuts to healthcare for the poor, transportation, and so on. The bill would implement $4.5 trillion in spending cuts in exchange for a $1.5 trillion increase in the US debt limit. However, it is very unlikely to pass the Democrat-controlled Senate while the White House has previously said that the president would veto the legislation. Notably, as the speaker of the House McCarthy has primary control over US budget issues and Biden has said he would not accept these deep cuts, the impasse has raised the possibility of Congress and the White House overseeing the first national debt default. Biden might cancel Asia trip After the meeting, Biden indicated that he might cancel his upcoming trip to Asia for Group of Seven (G7) meetings. When asked about the meetings, he said that it is “possible” that he would not make the trip, “If somehow we got down to the wire and still haven't resolved this... I would not go,” the US president told reporters, as quoted by news agency AFP. Yellen’s warning In a letter addressed to the House speaker and other lawmakers earlier this month, Yellen had warned, “Our best estimate is that we will be unable to continue to satisfy all of the government's obligations by early June, and potentially as early as June 1, if Congress does not raise or suspend the debt limit before that time.” She added, “It is impossible to predict with certainty the exact date when Treasury will be unable to pay the government’s bills, and I will continue to update Congress in the coming weeks as more information becomes available.” Yellen has also recently said that unless Congress acts in the coming weeks, “financial and economic chaos would ensue.” If the debt ceiling is not raised or suspended by Congress the government risks defaulting on payment obligations which would have a significant impact on the US economy. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

US Pres Biden, House Speaker McCarthy meeting on debt ceiling fails to break deadlock, threat of default looms

A recent survey by the Federal Reserve shows the US economy is in bad shape. The Fed survey points to difficulties in getting loans as banks are tightening their lending standards.

US faces credit crunch amid bank turmoil

The US Federal Reserve raised its interest rates by a quarter of a percentage point for a 10th&nbsp;consecutive time on Wednesday (May 3), while indicating a pause in further increases. This comes amid recent bank failures as well as Congress’ ongoing deadlock over the debt ceiling issue.&nbsp;

The central bank has been aggressively raising interest rates since March last year in a bid to control the US’ soaring inflation and pushed its benchmark overnight interest rate somewhere in the 5.00 per cent and 5.25 per cent range. In the statement, the Fed also said that it would “take into account” the impact of tighter monetary policy and “economic and financial developments” going forward.

During the press conference, Fed Chair Jerome Powell said that the central bank still views inflation as too high and that it remains concerned by high price pressures. However, it no longer “anticipates” further hikes and monitors the incoming data to make the decision if more hikes “may be appropriate.”

Therefore, Powell has said that it is too soon to say if the rate-hike cycle is over as the decisions made by officials are taking on a “meeting-by-meeting” basis, adding, “we are prepared to do more&nbsp;with rate rises if needed.”&nbsp;

The decision about the recent hike came after the policy-setting Federal Open Market Committee’s (FOMC) recent meeting and was in line with the expectations of analysts and traders.&nbsp;

Notably, the recent statement by the central bank marks a departure from the last rate announcement where policymakers had said that they expect “additional policy firming” to rein in inflation. This time around, the Fed’s ease of guidance suggests that the economy is somewhat beginning to cool.&nbsp;

“If you add up all the tightening that's going on through various channels, we feel like we're getting close or are maybe even there,” said Powell, as quoted by Reuters, about monetary policy. The Fed chair also pushed back on market expectations of rate cuts this year adding, “We on the committee have a view that inflation is going to come down not so quickly, it will take some time.”&nbsp;

It is worth noting that the Fed’s policy rate, this time around, is somewhat close to where it was on the eve of the 2008 financial crisis. The rate hikes have more than doubled mortgage rates, elevated the costs of auto loans, credit card borrowing and business loans and heightened the risk of a recession, reported The Associated Press.&nbsp;

(With inputs from agencies)&nbsp; 
 
 
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The US Federal Reserve raised its interest rates by a quarter of a percentage point for a 10th consecutive time on Wednesday (May 3), while indicating a pause in further increases.

The US Federal Reserve raised its interest rates by a quarter of a percentage point for a 10th consecutive time on Wednesday (May 3), while indicating a pause in further increases. This comes amid recent bank failures as well as Congress’ ongoing deadlock over the debt ceiling issue. The central bank has been aggressively raising interest rates since March last year in a bid to control the US’ soaring inflation and pushed its benchmark overnight interest rate somewhere in the 5.00 per cent and 5.25 per cent range. In the statement, the Fed also said that it would “take into account” the impact of tighter monetary policy and “economic and financial developments” going forward. During the press conference, Fed Chair Jerome Powell said that the central bank still views inflation as too high and that it remains concerned by high price pressures. However, it no longer “anticipates” further hikes and monitors the incoming data to make the decision if more hikes “may be appropriate.” Therefore, Powell has said that it is too soon to say if the rate-hike cycle is over as the decisions made by officials are taking on a “meeting-by-meeting” basis, adding, “we are prepared to do more with rate rises if needed.” The decision about the recent hike came after the policy-setting Federal Open Market Committee’s (FOMC) recent meeting and was in line with the expectations of analysts and traders. Notably, the recent statement by the central bank marks a departure from the last rate announcement where policymakers had said that they expect “additional policy firming” to rein in inflation. This time around, the Fed’s ease of guidance suggests that the economy is somewhat beginning to cool. “If you add up all the tightening that's going on through various channels, we feel like we're getting close or are maybe even there,” said Powell, as quoted by Reuters, about monetary policy. The Fed chair also pushed back on market expectations of rate cuts this year adding, “We on the committee have a view that inflation is going to come down not so quickly, it will take some time.” It is worth noting that the Fed’s policy rate, this time around, is somewhat close to where it was on the eve of the 2008 financial crisis. The rate hikes have more than doubled mortgage rates, elevated the costs of auto loans, credit card borrowing and business loans and heightened the risk of a recession, reported The Associated Press. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

US Federal Reserve announces quarter-point interest rate hike, signals potential pause

The United States President, Joe Biden, on Monday (May 1) called for a meeting with the top four congressional leaders at the White House after Treasury Secretary Janet Yellen warned that Washington could run short of cash to pay all of the government’s bills as soon as June without a debt limit increase. The lack of funds to pay US’ debt obligations could trigger a catastrophic default.&nbsp;

What does Biden plan on doing?

A brief statement by the White House said that the president has invited House of Representatives Speaker, Kevin McCarthy and Democratic leaders of Congress “to a meeting at the White House on May 9.”&nbsp;

Meanwhile, a person familiar with the plans told Reuters that Biden has invited House Democratic leader Hakeem Jeffries, Senate Majority Leader Chuck Schumer and Republican leader Mitch McConnell to talk about the debt ceiling and federal spending.

This comes after the Republican-led House of Representatives passed a bill, in April,&nbsp;that would raise the debt ceiling in exchange for budget cuts to healthcare for the poor, transportation, and so on. The Department of Transportation has warned that the move&nbsp;would shut hundreds of air traffic control towers.

Additionally, the Republican bill would implement $4.5 trillion in spending cuts in exchange for a $1.5 trillion increase in the US debt limit. However, it is very unlikely to pass the Democrat-controlled Senate while the White House has previously said that the president would veto the legislation.&nbsp;

Notably, as the speaker of the House McCarthy has primary control over US budget issues and while Biden has said he would not accept these deep cuts, the impasse has raised the possibility of Congress and the White House overseeing the first national debt default.&nbsp;

Furthermore, if the debt ceiling is not raised or suspended by Congress the government risks defaulting on payment obligations which would have a significant impact on the US economy. This also comes as the US hit its $31.4 trillion borrowing limit in January.&nbsp;

What did Yellen say?

In a letter addressed to the House speaker and other lawmakers, on Monday,&nbsp;Yellen said, “Our best estimate is that we will be unable to continue to satisfy all of the government's obligations by early June, and potentially as early as June 1, if Congress does not raise or suspend the debt limit before that time.” .

She added, “Given the current projections, it is imperative that Congress act as soon as possible to increase or suspend the debt limit in a way that provides longer-term certainty that the government will continue to make its payments.”&nbsp;

The early June date has more or less remained unchanged from the previous estimate issued in January which said that the government could run out of cash on June 5. She also urged Congress to act quickly to raise the limit.&nbsp;

Yellen said that federal receipts and outlays are “inherently variable” and that the Treasury might exhaust its “extraordinary measures” a number of weeks later than these estimates.&nbsp;

“It is impossible to predict with certainty the exact date when Treasury will be unable to pay the government’s bills, and I will continue to update Congress in the coming weeks as more information becomes available,” Yellen wrote in the letter.&nbsp;

(With inputs from agencies)&nbsp; 
 
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The United States President, Joe Biden, on Monday (May 1) called for a meeting with the top four congressional leaders at the White House after Treasury Secretary Janet Yellen warned that Washington could run short of cash to pay all of the government’s bills as soon as June without a debt limit increase.

The United States President, Joe Biden, on Monday (May 1) called for a meeting with the top four congressional leaders at the White House after Treasury Secretary Janet Yellen warned that Washington could run short of cash to pay all of the government’s bills as soon as June without a debt limit increase. The lack of funds to pay US’ debt obligations could trigger a catastrophic default. What does Biden plan on doing? A brief statement by the White House said that the president has invited House of Representatives Speaker, Kevin McCarthy and Democratic leaders of Congress “to a meeting at the White House on May 9.” Meanwhile, a person familiar with the plans told Reuters that Biden has invited House Democratic leader Hakeem Jeffries, Senate Majority Leader Chuck Schumer and Republican leader Mitch McConnell to talk about the debt ceiling and federal spending. This comes after the Republican-led House of Representatives passed a bill, in April, that would raise the debt ceiling in exchange for budget cuts to healthcare for the poor, transportation, and so on. The Department of Transportation has warned that the move would shut hundreds of air traffic control towers. Additionally, the Republican bill would implement $4.5 trillion in spending cuts in exchange for a $1.5 trillion increase in the US debt limit. However, it is very unlikely to pass the Democrat-controlled Senate while the White House has previously said that the president would veto the legislation. Notably, as the speaker of the House McCarthy has primary control over US budget issues and while Biden has said he would not accept these deep cuts, the impasse has raised the possibility of Congress and the White House overseeing the first national debt default. Furthermore, if the debt ceiling is not raised or suspended by Congress the government risks defaulting on payment obligations which would have a significant impact on the US economy. This also comes as the US hit its $31.4 trillion borrowing limit in January. What did Yellen say? In a letter addressed to the House speaker and other lawmakers, on Monday, Yellen said, “Our best estimate is that we will be unable to continue to satisfy all of the government's obligations by early June, and potentially as early as June 1, if Congress does not raise or suspend the debt limit before that time.” . She added, “Given the current projections, it is imperative that Congress act as soon as possible to increase or suspend the debt limit in a way that provides longer-term certainty that the government will continue to make its payments.” The early June date has more or less remained unchanged from the previous estimate issued in January which said that the government could run out of cash on June 5. She also urged Congress to act quickly to raise the limit. Yellen said that federal receipts and outlays are “inherently variable” and that the Treasury might exhaust its “extraordinary measures” a number of weeks later than these estimates. “It is impossible to predict with certainty the exact date when Treasury will be unable to pay the government’s bills, and I will continue to update Congress in the coming weeks as more information becomes available,” Yellen wrote in the letter. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

US debt ceiling: Amid Yellen's warning, Biden invites House speaker, Congress leaders for talks

Michael Barr, the vice chair for supervision at the Fed planned to inform lawmakers that mismanagement and a sudden fear among depositors were to blame for Silicon Valley Bank's implosion. Barr, describes how the SVB leadership failed to adequately manage interest rate and liquidity risk in prepared testimony made public on Monday. In his statement before the Senate Banking Committee, Barr claims that SVB's demise is "a textbook illustration of mismanagement."

Our regulatory system failed: Fed vice chairperson on Silicon Valley collapse

An investigation into Silicon Valley Bank's (SVB) failure has been started by the Office of Inspector General (OIG) of the US Federal Reserve, an OIG representative announced on Tuesday. According to a top Federal Reserve official, the failure of Silicon Valley Bank (SVB) was a classic case of mismanagement that calls for more banking supervision.

US Federal Reserve watchdog launches probe of Silicon Valley Bank supervision

According to a top Federal Reserve official, the failure of Silicon Valley Bank (SVB) was a classic case of mismanagement that calls for more banking supervision. In statements made public before of a Senate hearing on Tuesday, Michael Barr, the Fed's vice chair for supervision, stated that "SVB collapsed because the bank's management did not adequately manage its interest rate and liquidity risk."

Silicon Valley Bank collapse: Textbook case of mismanagement

First Citizens BancShares Inc. was in advanced negotiations to buy Silicon Valley Bank (SVB). The Federal Deposit Insurance Corp (FDIC) may soon sell Silicon Valley Bank to First Citizens, according to Bloomberg News, which broke the news first. One of the main buyers of bankrupt American lenders is the firm.

First Citizens in advanced talk to BUY COLLAPSED Silicon Valley Bank

US Treasury Secretary Janet Yellen has said that banks across the America are worried about contagion and have been shoring up liquidity to protect themselves from runs after the failures of Silicon Valley Bank and Signature Bank.

Asian markets fall on Janet Yellen's remark

Lawyers for the part of Silicon Valley Bank that has been put into bankruptcy protection accused US bank regulators of having drained roughly $2bn of cash from the institution, setting the stage for a fight that will decide how much investors, including Appaloosa and Pimco, recoup in the restructuring.

SVB's financial bankruptcy leads to cash seizure conflict

SVB Financial Group has filed for a court-supervised reorganisation under Chapter 11 bankruptcy protection to seek buyers for its assets, a week after its former division Silicon Valley Bank was taken over by US regulators.

Silicon Valley Bank's bankruptcy faces challenges

The collapse of silicon valley bank last week raised questions about what else might be lurking in the wider system. Within days, the market turmoil ensnared swiss lender Credit Suisse, forcing it to borrow up to $54 billion from Switzerland's central bank. Now, large U.S. Banks have injected $30 billion in deposits into first republic bank. The lender is caught up in a widening crisis, triggered by the collapse of 2 other mid-size U.S. Lenders over the past week. Analysts say investors are fretting about potential runs on global bank deposits, with contagion talk sweeping across trading floors. Yesterday, while swiss giant Credit Suisse announced borrowing to shore up liquidity, the spotlight shifted back to the U.S. The shares of first republic, a regional lender, had tumbled 70% in the last nine trading sessions. Some of the biggest U.S. Banking names including, JPMorgan chase, Citigroup, Bank of America, wells Fargo, Goldman Sachs & Morgan Stanley are involved in the rescue

Banking giants swoop in to rescue First Republic Bank; Contagion talk sweeping across trading floors

The collapse of silicon valley bank last week raised questions about what else might be lurking in the wider system. Within days, the market turmoil ensnared Swiss lender Credit Suisse, forcing it to borrow up to $54 billion from Switzerland's central bank. Now, large U.S. Banks have injected $30 billion in deposits into first republic bank. The lender is caught up in a widening crisis, triggered by the collapse of 2 other mid-size U.S. Lenders over the past week. Analysts say investors are fretting about potential runs on global bank deposits, with contagion talk sweeping across trading floors. Yesterday, while Swiss giant Credit Suisse announced borrowing to shore up liquidity, the spotlight shifted back to the U.S. The shares of first republic, a regional lender, had tumbled 70% in the last nine trading sessions. Some of the biggest U.S. Banking names including, JPMorgan chase, Citigroup, Bank of America, wells Fargo, Goldman Sachs & Morgan Stanley are involved in the rescue.

Silicon Valley Bank & Signature Bank Rattle Global Markets: What You Need to Know

The collapse of silicon valley bank last week raised questions about what else might be lurking in the wider system. Within days, the market turmoil ensnared swiss lender Credit Suisse, forcing it to borrow up to $54 billion from Switzerland's central bank. Now, large U.S. Banks have injected $30 billion in deposits into first republic bank. The lender is caught up in a widening crisis, triggered by the collapse of 2 other mid-size U.S. Lenders over the past week. Analysts say investors are fretting about potential runs on global bank deposits, with contagion talk sweeping across trading floors. Yesterday, while swiss giant Credit Suisse announced borrowing to shore up liquidity, the spotlight shifted back to the U.S. The shares of first republic, a regional lender, had tumbled 70% in the last nine trading sessions. Some of the biggest U.S. Banking names including, JPMorgan chase, Citigroup, Bank of America, wells Fargo, Goldman Sachs & Morgan Stanley are involved in the rescue.

Global markets rattles by SVB & signature bank

U.S. regulators shut down Silicon Valley Bank (SVB) on Friday and took control of its deposits after the high-tech lender’s share price nosedived. Just hours before the sudden collapse of the Silicon Valley Bank, the biggest bank failure in the US since the 2007-2008 Global Financial Crisis, US Treasury Secretary Janet Yellen said that the Treasury Department is keeping a close look at a few banks.

SVB meltdown sends shockwaves across markets

US President Joe Biden addressed Congress and the American people in his second state of the Union address. With a tine of optimism he tried to tout a growing economy.

US President Joe Biden's second state of the Union address, says 'Democracy unbowed & unbroken'

Commerce Department in the United States said on Thursday (January 26) that the economy grew slower in 2022 amid fears of recession. At the fag end of the year, the economy performed slightly better than expected amid looming recession fears, higher borrowing costs and the rising cost of living.&nbsp;The US Commerce Department revealed that the economy grew at an annual rate of 2.9 per cent in the last three months of 2022, down from 3.2 per cent in the previous quarter.&nbsp;

In a statement, the department said that the "increase in real GDP in 2022 primarily reflected increases in consumer spending, exports" and certain forms of investment.&nbsp;

The economic activity in the country was moderating as the central bank increased the benchmark lending rate seven times last year. The hikes were aimed at cooling demand and reining in costs as inflation surged.

ALSO READ |&nbsp;<a href="https://www.wionews.com/world/united-states-arms-exports-up-49-in-fiscal-2022-556283">United States arms exports to foreign governments rose 49% in fiscal 2022</a>&nbsp;

In 2022, declines in manufacturing and retail sales led to a slump in the property sector. The year remained a healing period for the economy, which has faced the wrath of the pandemic and the Russia-Ukraine war.&nbsp;

According to Commerce Department data, the US economy expanded 2.1 per cent for all of 2022, down from the figure in 2021.&nbsp;

WATCH |&nbsp;Former US president Donald trump wins golf championship at his own club&nbsp;

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As quoted by CNN, John Leer, chief economist of Morning Consult, said, "A shockingly resilient consumer mostly fueled the robust economic growth during the last quarter of 2022."&nbsp;

He said, "Consumers are increasingly struggling to navigate the ongoing effects from the spike in prices last year by drawing on credit and savings."&nbsp;

"With consumer demand likely to continue its downward trajectory, business investment is also likely to slow in the coming quarters, increasing the probability of a recession this year," he added.&nbsp;

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Commerce Department in the United States said on Thursday (January 26) that the economy grew slower in 2022 amid fears of recession. At the fag end of the year, the economy performed slightly better than expected amid looming recession fears, higher borrowing costs and the rising cost of living.

Commerce Department in the United States said on Thursday (January 26) that the economy grew slower in 2022 amid fears of recession. At the fag end of the year, the economy performed slightly better than expected amid looming recession fears, higher borrowing costs and the rising cost of living. The US Commerce Department revealed that the economy grew at an annual rate of 2.9 per cent in the last three months of 2022, down from 3.2 per cent in the previous quarter. In a statement, the department said that the "increase in real GDP in 2022 primarily reflected increases in consumer spending, exports" and certain forms of investment. The economic activity in the country was moderating as the central bank increased the benchmark lending rate seven times last year. The hikes were aimed at cooling demand and reining in costs as inflation surged. ALSO READ | United States arms exports to foreign governments rose 49% in fiscal 2022 In 2022, declines in manufacturing and retail sales led to a slump in the property sector. The year remained a healing period for the economy, which has faced the wrath of the pandemic and the Russia-Ukraine war. According to Commerce Department data, the US economy expanded 2.1 per cent for all of 2022, down from the figure in 2021. WATCH | Former US president Donald trump wins golf championship at his own club × As quoted by CNN, John Leer, chief economist of Morning Consult, said, "A shockingly resilient consumer mostly fueled the robust economic growth during the last quarter of 2022." He said, "Consumers are increasingly struggling to navigate the ongoing effects from the spike in prices last year by drawing on credit and savings." "With consumer demand likely to continue its downward trajectory, business investment is also likely to slow in the coming quarters, increasing the probability of a recession this year," he added. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

US economy performed better than expected in final months of last year

The US services industry activity has unexpectedly picked up last month. Economy continues to create jobs last month and wage growth is accelerating.

World Business Watch | US services sector activity unexpectedly accelerates in November

Here we bring you a quick round-up of all latest news, top headlines and international breakings from all across the globe, stay tuned with Gravitas for more!

Gravitas Global Headlines: Concerns rise over US economy | Liz Truss apologizes

JP Morgan Chase CEO Jamie Dimon has predicted that the United States and global economy would plunge into a recession next year. He was speaking with CNBC when he made the prediction.

Runaway inflation, big interest rates hikes, the Russian invasion of Ukraine and the unknown effects of the Federal Reserve's quantitative easing policy are among the indicators of a potential recession, he said in an interview to the business news channel.

"These are very, very serious things which I think are likely to push the US and the world — I mean, Europe is already in recession — and they're likely to put the US in some kind of recession six to nine months from now," Dimon said.

Dimon's comments came just when US banks would begin to file third-quarter earnings from Friday. This year the benchmark S&amp;P 500 index has lost about 24 per cent. All three major US indices have been trading in bear market territory.

Dimon said the S&amp;P 500 could fall by "another easy 20%" from the current levels, with the next 20% slide likely to "be much more painful than the first", according to the CNBC report.

Earlier this year, Dimon had asked investors to brace for an economic "hurricane", with JPMorgan, the biggest US investment bank, suspending share buybacks in July after missing quarterly Wall Street expectations.

(With inputs from agencies)

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JP Morgan Chase CEO Jamie Dimon has predicted that the United States and global economy would plunge into a recession next year. He was speaking with CNBC when he made the prediction.

JP Morgan Chase CEO Jamie Dimon has predicted that the United States and global economy would plunge into a recession next year. He was speaking with CNBC when he made the prediction. Runaway inflation, big interest rates hikes, the Russian invasion of Ukraine and the unknown effects of the Federal Reserve's quantitative easing policy are among the indicators of a potential recession, he said in an interview to the business news channel. "These are very, very serious things which I think are likely to push the US and the world — I mean, Europe is already in recession — and they're likely to put the US in some kind of recession six to nine months from now," Dimon said. Dimon's comments came just when US banks would begin to file third-quarter earnings from Friday. This year the benchmark S&P 500 index has lost about 24 per cent. All three major US indices have been trading in bear market territory. Dimon said the S&P 500 could fall by "another easy 20%" from the current levels, with the next 20% slide likely to "be much more painful than the first", according to the CNBC report. Earlier this year, Dimon had asked investors to brace for an economic "hurricane", with JPMorgan, the biggest US investment bank, suspending share buybacks in July after missing quarterly Wall Street expectations. (With inputs from agencies) You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here. WATCH WION LIVE HERE ×

US economy to dip into recession next year: JP Morgan CEO Jamie Dimon

America's gross national debt has reached an unfortunate high of $31 trillion for the first time ever, revealed a Treasury Department report on Tuesday. The artificial borrowing cap Congress imposed on the US government is progressively getting closer as debt edges closer to the statutory ceiling of $31.4 trillion.

The debt threshold not only spells trouble for the nation's economy but also poses a problem for Joe Biden who will once again be running for President in 2024.&nbsp;

He had promised to reduce US budget deficits i.e., what government earns through tax revenue vs the money it spends by $1 trillion over a decade. However, as per estimates by the Committee for a Responsible Federal Budget estimates, his policies have added nearly $5 trillion to the deficit since he took office in 2020.&nbsp;

Watch |&nbsp;US: Job openings fall sharply to 10.053 MN in August, record National debt

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Even as President Joe Biden touts his administration's attempts to reduce the deficit and even introduced the so-called Inflation Reduction Act that attempts to tame a 40-year price increase, economists say that the latest debt numbers are a cause for concern.

This comes as higher borrowing costs replace the nation's historically low-interest rates as the Federal Reserve attempts to combat rapid inflation.

To combat the pandemic and finance tax cuts the government undertook record levels of borrowings, which due to the higher rates are making America's debt costly over time.

Also read |&nbsp;<a href="https://www.wionews.com/world/zero-covid-a-crumbling-real-estate-market-and-more-chinese-economy-and-the-challenges-it-faces-522534" hreflang="en">Zero-Covid, a crumbling real estate market and more: Chinese economy and the challenges it faces</a>

As per estimates by the Peterson Foundation, higher rates could add around one trillion dollars to US federal government's interest payments this decade. Additionally, the Congressional Budget Office (CBO) May forecast&nbsp;that debt costs would reach a record $8.1 trillion.

If interest rates on the nation's debt increase by just one percentage point beyond what the CBO forecasts over the next few years, interest payments might surpass United States' national defence expenditure by 2029, reports the New York Times.

(With inputs from agencies)

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America's gross national debt has reached an unfortunate high of $31 trillion for the first time ever, revealed a Treasury Department report on Tuesday. The artificial borrowing cap Congress imposed on the US government is progressively getting closer as debt edges closer to the statutory ceiling of $31.

America's gross national debt has reached an unfortunate high of $31 trillion for the first time ever, revealed a Treasury Department report on Tuesday. The artificial borrowing cap Congress imposed on the US government is progressively getting closer as debt edges closer to the statutory ceiling of $31.4 trillion. The debt threshold not only spells trouble for the nation's economy but also poses a problem for Joe Biden who will once again be running for President in 2024. He had promised to reduce US budget deficits i.e., what government earns through tax revenue vs the money it spends by $1 trillion over a decade. However, as per estimates by the Committee for a Responsible Federal Budget estimates, his policies have added nearly $5 trillion to the deficit since he took office in 2020. Watch | US: Job openings fall sharply to 10.053 MN in August, record National debt Even as President Joe Biden touts his administration's attempts to reduce the deficit and even introduced the so-called Inflation Reduction Act that attempts to tame a 40-year price increase, economists say that the latest debt numbers are a cause for concern. This comes as higher borrowing costs replace the nation's historically low-interest rates as the Federal Reserve attempts to combat rapid inflation. To combat the pandemic and finance tax cuts the government undertook record levels of borrowings, which due to the higher rates are making America's debt costly over time. Also read | Zero-Covid, a crumbling real estate market and more: Chinese economy and the challenges it faces As per estimates by the Peterson Foundation, higher rates could add around one trillion dollars to US federal government's interest payments this decade. Additionally, the Congressional Budget Office (CBO) May forecast that debt costs would reach a record $8.1 trillion. If interest rates on the nation's debt increase by just one percentage point beyond what the CBO forecasts over the next few years, interest payments might surpass United States' national defence expenditure by 2029, reports the New York Times. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

US debt reaches all-time high of $31 trillion, by 2029 interest payments may overtake defence expenditure

The world’s largest economy has contracted for a second consecutive quarter. The US recorded a 0.9% decline in output on an annualized basis between April and June.

Recession fears deepen as US economy contracts for second consecutive quarter

Gravitas Global Headlines | US Economy contracts | Russia-Ukraine war continues | WION

The US economy has contracted for the second consecutive quarter, a development that in many other nations would be regarded as an economic recession. In contrast, the US uses extra information to make that choice. But the shrinkage, which occurred at an annual pace of 0.9 percent in the three months leading up to July, has received a lot of attention as economic worries intensify.

The cost of food, gas, and other necessities is rising at a rate not seen since 1981.

Fears are growing that a recession is on the horizon, if it hasn't already, as the US central bank aggressively increases borrowing prices to try to cool the economy and reduce pricing pressures.

US President Joe Biden has attempted to persuade the public that the economy is still in good shape by pointing out that the unemployment rate remains at 3.6 percent and that hiring has remained strong in the face of declining public confidence.

The release of the report is crucial. Under the pressure of severe inflation and rising borrowing prices, consumers and companies have been struggling. In an effort to combat the worst inflation outbreak in four decades, the Federal Reserve hiked its benchmark interest rate by a hefty three-quarters of a point on Wednesday. The famously challenging "soft landing" that the Fed is aiming for is an economic downturn that manages to contain skyrocketing prices without sparking a recession. 
 
Watch: US GDP shrinks by 1.4% in first quarter

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Consumer confidence has been damaged by the inflation increase and the public's anxiety over a potential recession, and the economy is currently delivering frustratingly conflicting signals as a result. Additionally, as the November midterm elections draw closer, the unhappiness of the populace has lowered President Joe Biden's public popularity ratings and raised the possibility that the Democrats may lose control of the House of Representatives and the Senate.

Consumer spending is still increasing. However, Americans are becoming less confident: According to the Conference Board, a research organisation, their forecast for the state of the economy six months from now has dropped to its lowest level since 2013.

(With inputs from agencies) 
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The US economy has contracted for the second consecutive quarter, a development that in many other nations would be regarded as an economic recession. In contrast, the US uses extra information to make that choice.

The US economy has contracted for the second consecutive quarter, a development that in many other nations would be regarded as an economic recession. In contrast, the US uses extra information to make that choice. But the shrinkage, which occurred at an annual pace of 0.9 percent in the three months leading up to July, has received a lot of attention as economic worries intensify. The cost of food, gas, and other necessities is rising at a rate not seen since 1981. Fears are growing that a recession is on the horizon, if it hasn't already, as the US central bank aggressively increases borrowing prices to try to cool the economy and reduce pricing pressures. US President Joe Biden has attempted to persuade the public that the economy is still in good shape by pointing out that the unemployment rate remains at 3.6 percent and that hiring has remained strong in the face of declining public confidence. The release of the report is crucial. Under the pressure of severe inflation and rising borrowing prices, consumers and companies have been struggling. In an effort to combat the worst inflation outbreak in four decades, the Federal Reserve hiked its benchmark interest rate by a hefty three-quarters of a point on Wednesday. The famously challenging "soft landing" that the Fed is aiming for is an economic downturn that manages to contain skyrocketing prices without sparking a recession. Watch: US GDP shrinks by 1.4% in first quarter Consumer confidence has been damaged by the inflation increase and the public's anxiety over a potential recession, and the economy is currently delivering frustratingly conflicting signals as a result. Additionally, as the November midterm elections draw closer, the unhappiness of the populace has lowered President Joe Biden's public popularity ratings and raised the possibility that the Democrats may lose control of the House of Representatives and the Senate. Consumer spending is still increasing. However, Americans are becoming less confident: According to the Conference Board, a research organisation, their forecast for the state of the economy six months from now has dropped to its lowest level since 2013. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Fueling recession fears, the US economy shrank again in second quarter

Inflation in the United States of America is at a 40-year high. According to a government report released on Wednesday, inflation has hit 9.1 percent in the 12 months to June. Here at 'The Full Context', we decode this and more!

The Full Context: U.S. inflation at an all time high, How does this affect you?

Just a day&nbsp;after Elon Musk's email to Tesla executives about a 10 per cent job cut and how he feels 'super bad' about the US economy got leaked, US President Joe Biden in what could be seen as a rare rebuke responded "Lots of luck on his trip to the moon".&nbsp;Biden made the remark while speaking to the press on the stronger-than-expected job growth in the United States in May as he also brushed aside criticism of his handling of inflation.

President Biden and the Tesla CEO have long shared a frosty relationship.&nbsp;Musk has in the past complained that the Viden administration has “done everything it can to sideline and ignore Tesla".

On Friday, when asked by reporters to remark on Musk's comments about United States' economy, the President said that while the Tesla CEO is talking about that companies such as Ford are looking to hire more people as they invest in electrical vehicles.

Watch |&nbsp;Musk wants to cut Tesla staff by 10%

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"While Elon Musk is talking about that, Ford is increasing their investment overwhelmingly," &nbsp;said Biden.&nbsp;

"Ford is increasing investment and building new electric vehicles. Six thousand new employees, union employees I might add, in the Midwest."

"The former Chrysler Corporation, they also are making similar investments in electric vehicles. Intel is adding 20,000 new jobs making computer chips. So, you know, lots of luck on his trip to the moon.”

Following Biden's "wishes" the billionaire Musk tweeted "Thanks Mr President!" adding to his tweet a link to NASA's April 2021 award of a $2.9 billion contract to SpaceX for the development of a vehicle to transport astronauts to the Moon.

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Thanks Mr President!<a href="https://t.co/dCcTQLsJTp">https://t.co/dCcTQLsJTp</a>
— Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/1532743768503459843?ref_src=twsrc%5Etfw">June 3, 2022</a></blockquote>
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Also read |&nbsp;<a href="https://www.wionews.com/world/elon-musk-may-cut-10-jobs-in-tesla-he-has-super-bad-feeling-about-economy-484711">Elon Musk may cut 10% jobs in Tesla, he has 'super bad feeling' about economy</a>

On Thursday, Musk wrote in an email to Tesla executives that he had a bad feeling about the economy and that the company needed to make a 10 per cent job cut.

Inflation in the United States is near 40-year highs, resulting in a significant increase in the cost of living for Americans. However, the US President said that believes that the latest batch of solid employment figures shows the United States can confront inflation while maintaining healthy economic growth.

Highlighting the US economy's durability in the face of rising consumer costs Biden remarked,&nbsp;"We've laid an economic foundation that's historically strong".

(With inputs from agencies)

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Just a day after Elon Musk's email to Tesla executives about a 10 per cent job cut and how he feels 'super bad' about the US economy got leaked, US President Joe Biden in what could be seen as a rare rebuke responded "Lots of luck on his trip to the moon".

Just a day after Elon Musk's email to Tesla executives about a 10 per cent job cut and how he feels 'super bad' about the US economy got leaked, US President Joe Biden in what could be seen as a rare rebuke responded "Lots of luck on his trip to the moon". Biden made the remark while speaking to the press on the stronger-than-expected job growth in the United States in May as he also brushed aside criticism of his handling of inflation. President Biden and the Tesla CEO have long shared a frosty relationship. Musk has in the past complained that the Viden administration has “done everything it can to sideline and ignore Tesla". On Friday, when asked by reporters to remark on Musk's comments about United States' economy, the President said that while the Tesla CEO is talking about that companies such as Ford are looking to hire more people as they invest in electrical vehicles. Watch | Musk wants to cut Tesla staff by 10% "While Elon Musk is talking about that, Ford is increasing their investment overwhelmingly," said Biden. "Ford is increasing investment and building new electric vehicles. Six thousand new employees, union employees I might add, in the Midwest." "The former Chrysler Corporation, they also are making similar investments in electric vehicles. Intel is adding 20,000 new jobs making computer chips. So, you know, lots of luck on his trip to the moon.” Following Biden's "wishes" the billionaire Musk tweeted "Thanks Mr President!" adding to his tweet a link to NASA's April 2021 award of a $2.9 billion contract to SpaceX for the development of a vehicle to transport astronauts to the Moon. Thanks Mr President!https://t.co/dCcTQLsJTp — Elon Musk (@elonmusk) June 3, 2022 × Also read | Elon Musk may cut 10% jobs in Tesla, he has 'super bad feeling' about economy On Thursday, Musk wrote in an email to Tesla executives that he had a bad feeling about the economy and that the company needed to make a 10 per cent job cut. Inflation in the United States is near 40-year highs, resulting in a significant increase in the cost of living for Americans. However, the US President said that believes that the latest batch of solid employment figures shows the United States can confront inflation while maintaining healthy economic growth. Highlighting the US economy's durability in the face of rising consumer costs Biden remarked, "We've laid an economic foundation that's historically strong". (With inputs from agencies) Watch WION LIVE HERE: You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

'Thanks Mr President!': Elon Musk gets sarcastic with US President Joe Biden

Job gains maintained their impressive run in May, even as government policymakers took steps to cool the economy and ease inflation.

The Labor Department reported Friday that employers added 390,000 jobs, the 17th straight monthly gain.

The unemployment rate was 3.6 per cent&nbsp;for the third straight month, near a half-century low. Average hourly earnings for employees rose by 10 cents, or 0.3 per cent&nbsp;on a monthly basis, and were 5.2 per cent&nbsp;higher than a year earlier.

Record levels of consumer spending, which makes up about 70 per cent of the economy, have driven business expansion and job creation, as companies try to keep up with demand for a wide variety of goods and services. The hiring push has lent some workers a degree of agency regarding pay and conditions that is unfamiliar to both job seekers and employers.

Yet the Federal Reserve is worried that rising labor costs will be passed along to consumers, constraining efforts to bring down inflation, which is near a 40-year high.

Last month, Fed Chair Jerome Powell stressed that his institution’s attempts to cool off prices were a part of ensuring a more sustainable form of full employment. “We’ve got to get back to price stability so that we can have a labor market where people’s wages aren’t being eaten up by inflation,” he said. “And where we can have a long expansion, too.”

The environment for job seekers remains as strong as it has been since the 1960s, some economists say. The Kansas City Fed’s labour market conditions index — which is based on 24 measures tracking the market’s tightness — is near highs last seen in 2000.

In a speech, this week to the Economic Club of Memphis, Tennessee, James Bullard, president of the Federal Reserve Bank of St. Louis, noted that “real-time indicators” of economic growth suggested expansion would continue for several quarters.

It appears that fewer Americans will be able to fully share in a continued expansion, however. There are growing signals that lower-income families, which have been hit the hardest by price increases and used up much of their pandemic-era savings, are beginning to pull back on discretionary purchases. The cost of groceries is an intensifying headache, and energy prices, which are roughly 30 per cent&nbsp;higher than a year ago, are forcing people to make difficult decisions about what goods and services to cut back on to prevent further erosion of their budgets.

Inflation has already made a striking impact: Personal savings as a percentage of personal disposable income fell to 4.4 per cent&nbsp;in April, the Commerce Department reported last week. It was the lowest rate since 2008, and far from the anomalous high of 33 per cent&nbsp;in April 2020 at the height of federal aid.

Throughout the year, inflation and general volatility in the economy have created a dissonance between sour consumer sentiment and relatively positive raw data. Checking accounts are still above 2019 levels for nearly all income groups. And the share of households under duress as a result of debt burdens is historically low. Auto loan delinquency rates are low. And new bankruptcies and debt-collection proceedings are at their lowest level since the New York Fed began collecting data on them in 1999.

The Fed’s aim is to engineer a modest economic slowdown that avoids a painful recession. Gregory Daco, chief economist at EY-Parthenon, a consulting firm, insisted that “whether we have a recession or not isn’t what matters” compared with the characteristics of any potential downturn, such as its depth and duration.

“Recency bias has us thinking of a recession being like the covid&nbsp;crisis, or the global financial crisis, but these were ‘once in a hundred years’ events which are unlikely to repeat in the near term,” he said. “At the same time, the elevated inflation backdrop has brought comparisons with the 1970s, but there again the situation was different, lasting 15 years from the late 1960s to the early 1980s and featuring two moderate and two deep recessions.”

Job gains maintained their impressive run in May, even as government policymakers took steps to cool the economy and ease inflation. The Labor Department reported Friday that employers added 390,000 jobs, the 17th straight monthly gain.

Job gains maintained their impressive run in May, even as government policymakers took steps to cool the economy and ease inflation. The Labor Department reported Friday that employers added 390,000 jobs, the 17th straight monthly gain. The unemployment rate was 3.6 per cent for the third straight month, near a half-century low. Average hourly earnings for employees rose by 10 cents, or 0.3 per cent on a monthly basis, and were 5.2 per cent higher than a year earlier. Record levels of consumer spending, which makes up about 70 per cent of the economy, have driven business expansion and job creation, as companies try to keep up with demand for a wide variety of goods and services. The hiring push has lent some workers a degree of agency regarding pay and conditions that is unfamiliar to both job seekers and employers. Yet the Federal Reserve is worried that rising labor costs will be passed along to consumers, constraining efforts to bring down inflation, which is near a 40-year high. Last month, Fed Chair Jerome Powell stressed that his institution’s attempts to cool off prices were a part of ensuring a more sustainable form of full employment. “We’ve got to get back to price stability so that we can have a labor market where people’s wages aren’t being eaten up by inflation,” he said. “And where we can have a long expansion, too.” The environment for job seekers remains as strong as it has been since the 1960s, some economists say. The Kansas City Fed’s labour market conditions index — which is based on 24 measures tracking the market’s tightness — is near highs last seen in 2000. In a speech, this week to the Economic Club of Memphis, Tennessee, James Bullard, president of the Federal Reserve Bank of St. Louis, noted that “real-time indicators” of economic growth suggested expansion would continue for several quarters. It appears that fewer Americans will be able to fully share in a continued expansion, however. There are growing signals that lower-income families, which have been hit the hardest by price increases and used up much of their pandemic-era savings, are beginning to pull back on discretionary purchases. The cost of groceries is an intensifying headache, and energy prices, which are roughly 30 per cent higher than a year ago, are forcing people to make difficult decisions about what goods and services to cut back on to prevent further erosion of their budgets. Inflation has already made a striking impact: Personal savings as a percentage of personal disposable income fell to 4.4 per cent in April, the Commerce Department reported last week. It was the lowest rate since 2008, and far from the anomalous high of 33 per cent in April 2020 at the height of federal aid. Throughout the year, inflation and general volatility in the economy have created a dissonance between sour consumer sentiment and relatively positive raw data. Checking accounts are still above 2019 levels for nearly all income groups. And the share of households under duress as a result of debt burdens is historically low. Auto loan delinquency rates are low. And new bankruptcies and debt-collection proceedings are at their lowest level since the New York Fed began collecting data on them in 1999. The Fed’s aim is to engineer a modest economic slowdown that avoids a painful recession. Gregory Daco, chief economist at EY-Parthenon, a consulting firm, insisted that “whether we have a recession or not isn’t what matters” compared with the characteristics of any potential downturn, such as its depth and duration. “Recency bias has us thinking of a recession being like the covid crisis, or the global financial crisis, but these were ‘once in a hundred years’ events which are unlikely to repeat in the near term,” he said. “At the same time, the elevated inflation backdrop has brought comparisons with the 1970s, but there again the situation was different, lasting 15 years from the late 1960s to the early 1980s and featuring two moderate and two deep recessions.”

US added 390,000 jobs in May amid efforts to cool the economy

Goldman Sachs Senior Chairman Lloyd Blankfein has asked companies and consumers to brace for an imminent recession in the US, saying it's a "very, very high risk."

"If I were running a big company, I would be very prepared for it," Blankfein said in an interview to CBS's "Face the Nation" on Sunday. "If I was a consumer, I'd be prepared for it."

Goldman Sachs is the second financial institution to forecast&nbsp;a recession for the US, which is battling inflation and high fuel prices.

US consumer sentiment had&nbsp;declined in early May to the lowest level since 2011, while&nbsp;the consumer prices spiked 8.3 per cent in April from a year ago, which is among the fastest in decades.

Earlier, Deutsche Bank had warned that the US is heading for a downturn caused by the Federal Reserve's aim to water down high inflation.

"We will get a major recession," Deutsche Bank economists wrote in a report to clients on Tuesday, CNN reported.

Watch |&nbsp;US Recession possibility 'very high risk factor', Goldman Sachs warns of growth forecast

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Blankfein remarks come after the firm’s economists cut the US growth forecasts for 2022 and 2023 to reflect the recent shake-out in financial markets, reports Bloomberg.

Goldman’s economic team expects US gross domestic product to expand 2.4 per cent this year, down from 2.6 per cent. It has also reduced its 2023 projections from 2.2 per cent to 1.6 per cent.

The report called this a “necessary growth slowdown” to help temper wage growth and reduce inflation back down towards the Fed’s 2 per cent target.

(With inputs from agencies)

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(With inputs from agencies)&nbsp;

Goldman Sachs Senior Chairman Lloyd Blankfein has asked companies and consumers to brace for an imminent recession in the US, saying it's a "very, very high risk.

Goldman Sachs Senior Chairman Lloyd Blankfein has asked companies and consumers to brace for an imminent recession in the US, saying it's a "very, very high risk." "If I were running a big company, I would be very prepared for it," Blankfein said in an interview to CBS's "Face the Nation" on Sunday. "If I was a consumer, I'd be prepared for it." Goldman Sachs is the second financial institution to forecast a recession for the US, which is battling inflation and high fuel prices. US consumer sentiment had declined in early May to the lowest level since 2011, while the consumer prices spiked 8.3 per cent in April from a year ago, which is among the fastest in decades. Earlier, Deutsche Bank had warned that the US is heading for a downturn caused by the Federal Reserve's aim to water down high inflation. "We will get a major recession," Deutsche Bank economists wrote in a report to clients on Tuesday, CNN reported. Watch | US Recession possibility 'very high risk factor', Goldman Sachs warns of growth forecast Blankfein remarks come after the firm’s economists cut the US growth forecasts for 2022 and 2023 to reflect the recent shake-out in financial markets, reports Bloomberg. Goldman’s economic team expects US gross domestic product to expand 2.4 per cent this year, down from 2.6 per cent. It has also reduced its 2023 projections from 2.2 per cent to 1.6 per cent. The report called this a “necessary growth slowdown” to help temper wage growth and reduce inflation back down towards the Fed’s 2 per cent target. (With inputs from agencies) WATCH WION LIVE HERE (With inputs from agencies)

Goldman Sachs predicts recession in US, calls it ‘very, very high risk’

As the US stocks rebounded after a rout on Monday, President Biden declared that battling inflation will be his "top domestic priority".

In a surprise move, the US president said he is "discussing"&nbsp;an end to China's trade tariffs but hasn't reached any decision yet.

"We're discussing that right now," Biden said on lifting trade tariffs against China.

On Tuesday, US WTI oil fell below $100 per barrel amid fears of a slowdown in the global economy.

<a href="https://www.wionews.com/world/uks-convenience-store-chain-mccolls-goes-bust-due-to-inflation-1100-stores-and-16000-jobs-at-risk-476913">Also Read:&nbsp;UK's convenience store chain McColl's goes bust due to inflation</a>

The US has witnessed the highest inflation in decades as several sectors face a shortage of workers. The US Fed's policy committee had&nbsp;last week raised the key rate by a half point even as Wall Street stocks took a battering on Monday.

Bitcoin fell under $30,000 to reach a ten-month low as the cryptocurrency continued to lose its value. The US Federal Reserve official had said earlier that it would work to bring down "unacceptably high" inflation.

Watch:&nbsp;Workers in Europe urge for more as inflation bites

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Central banks in the UK and Australia had also increased interest rates as data showed China's export had slowed to its weakest in nearly two years.

According to reports, consumer debts and credit rose 1.7 per cent in the US amid housing debt and zooming inflation and rates.

Student loans had also climbed to $14 billion in the first quarter of the year as consumer price inflation touched 8.5 per cent.

(With inputs from Agencies)

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As the US stocks rebounded after a rout on Monday, President Biden declared that battling inflation will be his "top domestic priority". In a surprise move, the US president said he is "discussing" an end to China's trade tariffs but hasn't reached any decision yet.

As the US stocks rebounded after a rout on Monday, President Biden declared that battling inflation will be his "top domestic priority". In a surprise move, the US president said he is "discussing" an end to China's trade tariffs but hasn't reached any decision yet. "We're discussing that right now," Biden said on lifting trade tariffs against China. On Tuesday, US WTI oil fell below $100 per barrel amid fears of a slowdown in the global economy. Also Read: UK's convenience store chain McColl's goes bust due to inflation The US has witnessed the highest inflation in decades as several sectors face a shortage of workers. The US Fed's policy committee had last week raised the key rate by a half point even as Wall Street stocks took a battering on Monday. Bitcoin fell under $30,000 to reach a ten-month low as the cryptocurrency continued to lose its value. The US Federal Reserve official had said earlier that it would work to bring down "unacceptably high" inflation. Watch: Workers in Europe urge for more as inflation bites Central banks in the UK and Australia had also increased interest rates as data showed China's export had slowed to its weakest in nearly two years. According to reports, consumer debts and credit rose 1.7 per cent in the US amid housing debt and zooming inflation and rates. Student loans had also climbed to $14 billion in the first quarter of the year as consumer price inflation touched 8.5 per cent. (With inputs from Agencies) WATCH WION LIVE HERE

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The US economy has unexpectedly shrunk in the first three months of 2022. This economic slope comes after more than a year of rapid growth and the new data is fueling concerns about a recession in the future.

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