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Fannie Mae Expects Modest Economic Growth for 2022 Before Entering a Mild Recession
Following an upward revision to third-quarter GDP and stronger-than-expected incoming personal consumption data to begin Q4, the economy is now expected to eke out positive growth of 0.4% in 2022 before entering a modest recession in the new year. That’s according to the December 2022 commentary from the Fannie Mae Economic and Strategic Research (ESR) Group.
With the onset of a recession predicted for Q1 of 2023, the ESR Group said it’s plausible that the Federal Reserve would begin cutting the federal funds rate in mid-2023.
“The economy caught its breath in the second half of 2022, but that doesn’t change our expectation that it will run out of air in early 2023 via a mild recession,” said Doug Duncan, chief economist, Fannie Mae. “While uncertainty still exists, a growing set of signs, including an inverted yield curve, weakness in the Conference Board’s Leading Economic Index, and a slowdown of manufacturing activity, support our ongoing contention that the economy is likely to contract next year.”
- ◦Economy
