Latest economic data suggests US recession looming

According to Longview Economics CEO Chris Watling, the latest economic data in the United States indicates a recession is arriving. Investors may have to prepare for some not-so-pleasant events on the stock market.

Talking on CNBC’s “Squawk Box Europe” on Friday, Watling said he considers a recession on the way and quoted some compelling and bad economic indicators.

The Conference Board reported on Thursday that its leading economic index for the US dropped by 1.2 percent in March, to the most inferior level after November 2020.

Watling expressed the data demonstrated that economic weakness could shortly amplify and extend across the US economy.

In complement to this alarm signal, Watling voiced the typical timeline for a recession following an inversion of the Treasury yield curve. It inverted in March 2022 and then also in the following months, was about a year.

Watling continued that a recession followed each time there was an inversion of the Treasury yield.

Recession Warnings

Many economists alerted of an imminent recession. The International Monetary Fund indicated as recently as last week that it was shocked by the recent strength of the US labor market. Consumer spending has also surprised the IMF.

On April 11, the IMF issued its latest global economic forecast report. It believes the world’s largest economy will expand by 1.6 percent this year. The number corresponds to the one percent forecast for 2022.

Gita Gopinath, the IMF’s first deputy managing director, informed CNBC last week that signs of cooling inflation data gave the fund grounds to believe the US economy could bypass a recession. But this statement also had a degree of reserve.