Only a miracle can save the United States from the recession that is becoming increasingly likely, said US economist Stephen Roach.
Economist Stephen Roach, a senior fellow at the Jackson Institute of Global Affairs at Yale University, told US broadcaster CNBC that persistent inflation would lead to a decline in consumer spending, which would “ripple through the economy and create difficulties in the labour market.”
He added, “We will see a cumulative decline in the economy (gross domestic product) of around 1.5% to 2%. In addition, the unemployment rate will rise by at least one to two percentage points,” the former president of Morgan Stanley’s Asian arm told CNBC.
Data released by the US Commerce Department showed that the US economy shrank at an annual rate of 0.6% in the second quarter of 2022, following a 1.6% decline in the first quarter.
According to CNBC, the negative economic growth seen in the year’s first half “could presage a much deeper recession that could last until 2024”.
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