Former Kansas City Fed President Thomas Hoenig forecasted when a recession in the U.S. could happen amid the central bank's expected aggressive tightening measures.
Former Kansas City Fed President Thomas Hoenig argues a recession in the U.S. could potentially happen 'sooner than next year' amid the central bank's tightening measures.
"I think the line they’re walking is very, very thin," Hoenig said on Wednesday, warning that the Fed is facing "almost an impossible challenge ahead of them." "They’re predicting that we’ll have this reduction in inflation and we will do it without a real significant increase in unemployment. I think that would be very pleasing if it were to occur, but I think it’s highly unlikely," he told hostHe stressed that it is reasonable to expect a "recession next year and depending on how much they [the Fed] move those 50 basis points forward towards us, maybe sooner than next year in terms of the slowdown.
"I have not in my experience witnessed a very consistent tightening series without there being a major slowdown in the economy and a risk of recession," he added.
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