Recessions are typically defined by economies experiencing two quarters of consecutive declines, and it appears that is where the U.S. is officially headed.
This week, stocks from the world’s largest companies such as Meta had fallen once again, a tangible sign that the economy has fallen into a recession.
Just yesterday, the Federal Reserve agreed to hike interest rates by an unprecedented three-quarters of a percentage point in an effort to slow down skyrocketing inflation. However, this move may be the tipping point towards a recession.
“Today’s reading only adds fuel to the fire that we are in or entering a recession,” said Mike Loewengart, managing director at E*Trade from Morgan Stanley. “While it is certainly on the negative side of estimates, keep in mind that a 1% decrease is relatively small and supports the idea that any recessionary environment will be mild.”
Experts have been predicting an incoming recession for several months now, leading spooked companies to freeze their hiring processes, pause certain projects, and conduct layoffs.
If this trajectory continues, more businesses are expected to take similar measures to mitigate their costs and weather the economic storm.
While this marks an uncertain entrance into the future of work, current analysis indicates that this downturn is still milder than previous recessions.