Washington is already dominated by recession anxiety. Currently, corporate America is in its grip.
CEOs across all sectors are growing concerned about the possibility of an impending economic downturn, which might happen within a few months due to high inflation and the Federal Reserve’s efforts to reduce prices by sharply hiking interest rates.
On the second-quarter business results calls that are starting to pour in, talk about the recession and inflation has predominated. Many business leaders claim they have stopped attempting to predict whether inflation has peaked and what the Fed will do about it in favour of focusing on preparing their companies for a protracted period of rising prices and slower growth.
Asutosh Padhi, managing partner for North America at consultancy firm McKinsey & Co., stated in an interview with POLITICO editors and reporters that “the discussion has changed on inflation.” At least among the clients I interact with, “they have stopped attempting to anticipate how much and how long” the run of inflation will last. “Let’s plan to consider what it means to lead via inflation. It’s permanent enough.”
Top CEOs complain in private about the Fed’s potential to speed up rate hikes due to inflation as well as what many claim are mistakes in Washington’s budgetary policies. According to surveys, consumer confidence is close to record lows and corporate confidence is declining.
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