PNN – In an interview, referring to the increase in the consumer price index in this country, American economists warned that the Central Bank of America probably has no choice but to create a recession after finding out that the increase in interest rates has not been effective in curbing inflation.
According to the report of Pakistan News Network from Business Insider, American economist Ian Lingen said in an interview with Bloomberg TV: The latest inflation report from the Federal Reserve (US central bank) shows that the US may be headed for recession.
He then added that this situation is probably created by the Federal Reserve.
As one of the senior members of BMO Investment Bank, Lingen added: If we continue with the inflation rate at this level, the Federal Reserve has no choice but to create a recession.
The economist’s comments come after March’s consumer price index, released on Wednesday, came in higher than expected, showing a 3.5 percent increase.
According to reports, this is contrary to market expectations that the Federal Reserve will pivot to reverse interest rate hikes.
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According to Lingen, the risk of a recession is likely to occur after the US central bank finds that the current interest rate of 5.25 to 5.50 percent has not been effective enough in curbing inflation.
The economist’s comments are particularly noteworthy after recent warnings that the Federal Reserve may be under pressure to raise interest rates again.
Francis Donald, the chief economist of “Minolife Financial Company” based in the United States, also confirmed Lingen’s words in this interview and warned: Now the situation is such that we are increasing the chances of bad events.
Mohammad Al-Erian, the prominent economist of Pimco Investment Company based in America, had previously warned that if the Federal Reserve wants to reach 2% inflation, the interest rate policy should remain unchanged for years.
Unemployment rate rises in California
According to the report of the US Department of Labor, the state of California saw an increase in applications for unemployment benefits in the week ending March 30, and this has sounded the alarm in this area.
According to the available statistics, this state has the highest number of unemployment claims with 2 thousand 147, and 2 states Pennsylvania with 1 thousand 913 and Iowa with 1 thousand 383 claims for unemployment benefits are in the next ranks.
The U.S. Bureau of Labor Statistics reported that California had an unemployment rate of 5.3 percent in February, the highest in the country and up from 5.2 percent in January. The unemployment rate during the same period in the country was 3.9%.
According to the California State Department of Employment, job losses have been especially significant in the construction sector, with 9,600 jobs lost. It is said that this section is affected by the disruptions caused by several storms that hit the region during the month of February.