But elevated inflation isn't necessarily a hindrance to the economy, Knapp said, pointing to 3%-4% inflation in the early 90s, years when the economy expanded and benefited from a huge boom in business spending. Some economists have argued that the Fed needs to press forward with rate hikes, given that inflation is still well-above the Fed's target, clocking in at 5% in March. The market is telling you, in terms of forward yield curves, that they expect the Fed to make a mistake," Knapp said, pointing to bond market futures pricing in a likely recession this year. ![]() "If credit drops that much, we've got a real, huge economic problem on our hands. ![]() Customize your logo with easy-to-use tools, as well as 100s of unique graphics and fonts. But high rates risk overtightening the economy into a recession – and the risk of a downturn has been amplified by the tightening of credit conditions stemming banking turmoil. Find logos tailored to your industry or create your own logo from scratch. Start with your business name and get a stunning logo and a brand kit. That reflects a major tightening in financial conditions, he said, calling the Fed's expected 25 basis-point rate hike this week "ridiculous."Ĭentral bankers have raised interest rates aggressively in the past year to bring down inflation. Select the logo package that's right for your business Add a website or domain name to launch your business Start Building Your Brand Design A Stunning Logo Use our logo maker to build your brand and launch your business. Bank deposits could fall by 11% in total, Knapp said, citing an estimate from Cato Institute's Mark Calabria.
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