Allianz chief economic adviser Mohamed El-Erian said on Sunday (9th) that the core inflation rate in the United States should continue to rise and the US Federal Reserve (Fed) policy has made a serious mistake, could lead to a “destructive recession”.
“I am concerned that the risk of a devastating US recession is very high, which could have been avoided in the first place,” Ilairan said in an interview.
He believes the Fed made two main mistakes, one is misidentifying inflation as a temporary condition and the other is that the Fed finally admitted that inflation was persistent and high but did not take any significant action. Allan likened the Fed’s inability to ease gas last year with the result of having to brake this year, which would plunge the US into a recession.
Ellen stressed that the Fed now must not only overcome inflation, but must also work to restore its credibility. “We have to suffer more before moving on to a world where central banks can change inflation targets. While there are valid reasons for changing inflation targets, it also takes a heavy toll on central bank credibility.”
Illairan predicts that the overall US inflation rate is expected to drop to around 8% in September, but the core inflation rate will still rise, so there is still an inflation problem.
Stephen Isaacs, president of investment advisory firm Alvine Capital, previously said that investors should think about fighting the Fed. People’s investment decisions aren’t necessarily in line with Fed stock, because the Fed can commit. errors and basically it was wrong. 2 years.
Isaacs also said that the US economy is not out of the woods yet and that more difficult conditions will emerge in the coming months.
