April 19, 2023
The collapse of Silicon Valley Bank is raising concerns about an upcoming recession in the US, according to experts. In the aftermath of the bank’s failure, retail sales have fallen for two consecutive months, manufacturing output has dipped, and commercial bank lending has increased only slightly. Although the economy has shown remarkable resilience since the beginning of the COVID-19 pandemic, experts suggest that this latest news could be a sign that a recession is on the way. The Federal Reserve has already raised interest rates to combat the predicted downturn, and its economists have anticipated a “mild recession” starting later this year. Some experts worry that the Fed will overdo its monetary tightening just as more Americans are beginning to enjoy the benefits of a full-employment economy. The stock market has not shown any signs of recession fears, however, with the S&P 500 index gaining over 7%. The Biden administration insists that the economy remains strong.
Source: Washington Post
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