The US economy is “very strong”, and it is unlikely that it will suffer a deep recession, but it may witness a contraction for a while. This is the vision of the CEO of Standard Chartered Bank, Bill Winters, for the foreseeable future of the US economy.
“I think it’s not a matter of a huge downturn in the US, I think that’s very unlikely,” Winters said. Until the economy slows down. Now does that lead to a deep recession? I think that’s not likely. Can we see a period of deflation? Yes.”
Winters confirmed that Standard Chartered’s credit committee “has not tightened its procedures at all” after the collapse of three US banks.
“We received net deposits during that period of global anxiety and we have a very strong capital position and a very strong liquidity position as well,” he added, but noted that the bank needed to closely monitor changes in banking regulation.
Winters said central banks need to make sure that banks that are highly liquid and in a sound position have access to liquidity, adding that he believes the Fed has not done enough “at the height of the crisis”.
He explained that “the reaction in the US was exemplary” and contained the crisis effectively, but added that the standard act was to provide liquidity to “challenged banks” before the crisis occurred.
He added, “I am not worried about the problems in the banking sector in the United States or Switzerland, as the problems have been limited so far, and I am not really worried about the spread of the impact of this to global economic activities,” adding that he is “very optimistic about the Gulf.”
On interest rates, Winters said, when asked about the worst-case scenario, “I don’t know,” but added that his bank is focusing on an interest rate of 5.25 percent “for the time being and for a while.”
2023-05-08 13:36:47
#Standard #Chartered #economic #recession
