US headed to recession that was ‘totally avoidable,' chief economist says

US headed to recession that was ‘totally avoidable,' chief economist says

(Hill) – Mohamed El-Erian,Allianz’s chief economic adviser, said on Sunday that the US was heading for a “totally avoidable” recession amid ongoing concerns about inflation and economic stability.

“I fear we risk a very high probability of a completely avoidable, destructive recession,” El-Erian notified “Face the Nation” from CBS, arguing that the Federal Reserve had made a mistake that would “go down in the history books.”

“One of them is misinterpreting inflation as temporary. They mean it’s temporary, it’s reversible, don’t worry about it. That’s mistake number one. And then mistake number two, when they finally realized that inflation was persistent and high. They don’t act. They don’t act in a meaningful way,” El-Erian said.

The Federal Reserve has raise interest rates to try to suppress inflation as worries about a potential recession grow.

United Nations last week be warned global recession as the international economy takes action to curb inflation. A survey released last week found that nearly 9 out of 10 global CEOs expect a recession in the next year.

“Even [Federal Reserve] Chairman Powell has gone from looking for a soft landing to a soft-ish landing now talking about pain. And that’s the problem. It was a late Federal Reserve fee. Not only must it overcome inflation, but it must restore its credibility,” said El-Erian about the economic institution.

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