Despite the U.S. economy growing at a fast pace, some economists are starting to worry over rising interest rates and a phenomenon called "flattening yield curve," CNBC reported on Monday.
The term means a negative signal from the bond market.
"The yield curve — with one exception in 1966 — has basically predicted every recession," Natixis' Chief Economist Joseph LaVorgna was quoted as saying by CNBC.
"If the curve inverts let's say in October, history would say the earliest you'd have a recession would be next summer, next August. And the latest would be August of 2020," LaVorgna added.
"Now it's possible that this time is different and the curve might be sending a different signal because long rates are relatively low."
U.S. economic growth will probably accelerate this year before slowing in 2019 to well below the Trump administration's 3 percent target as a fiscal stimulus fades, congressional researchers recently projected.
In an updated economic outlook, the nonpartisan Congressional Budget Office (CBO) projected that inflation adjusted or real gross domestic product (GDP) would grow 3.1 percent this year, exceeding 2.2 percent growth in 2017 due to lower income taxes, increased government spending and private investment.
The government slashed corporate and personal income taxes in January in a $1.5 trillion package and the U.S. Congress passed a $1.3 trillion spending bill in March.
Please click to read our informative text prepared pursuant to the Law on the Protection of Personal Data No. 6698 and to get information about the cookies used on our website in accordance with the relevant legislation.
6698 sayılı Kişisel Verilerin Korunması Kanunu uyarınca hazırlanmış aydınlatma metnimizi okumak ve sitemizde ilgili mevzuata uygun olarak kullanılan çerezlerle ilgili bilgi almak için lütfen tıklayınız.