Fed rate hikes: Cause for pause?
Fed watchers see potential for a pause in rate increases, but recent reports show the economy still runs hot.
After a solid third quarter, the economy could be poised for even faster growth in the fourth quarter in deference to the sharp rate tightening by the Fed. While higher borrowing rates should eventually tamp down hiring by businesses, strong job gains continue to support spending activity — with the labor market likely to keep some momentum into the new year. This should stave off recession conditions early in 2023, but a moderate contraction still appears likely later next year in response to further Fed rate increases, corporations diminished pricing power, and an earnings growth slowdown.
The information in this report is provided by Nationwide Economics and is general in nature and not intended as investment or economic advice, or a recommendation to buy or sell any security or adopt any investment strategy. Additionally, it does not take into account any specific investment objectives, tax and financial condition or particular needs of any specific person.
The economic and market forecasts reflect our opinion as of the date of this report and are subject to change without notice. These forecasts show a broad range of possible outcomes. Because they are subject to high levels of uncertainty, they will not reflect actual performance. We obtained certain information from sources deemed reliable, but we do not guarantee its accuracy, completeness or fairness.
Nationwide, the Nationwide N and Eagle and Nationwide is on your side are service marks of Nationwide Mutual Insurance Company. © 2023 Nationwide.
NFM-11859M1.3