The US economy is showing clear signs of slowing down, fueling concerns about a potential recession.
The Federal Reserve raises interest rates in an attempt to slow down growth, as it seeks to curb continued high inflation, as well as consumer prices rising on their fastest pace in over 40 years†
The labor market remains healthy, but consumer spending, which drives the bulk of economic activity in the United States, is losing momentum.
Here are eight other indicators that point to problems ahead:
1. Retail: The latest report from the Commerce Department showed that retail sales fell 0.3 percent in May and rose less in April than originally believed.
2. Consumer Confidence: In June, the University of Michigan survey of consumer confidence be touched lowest level in its 70-year historywith nearly half of respondents saying that inflation affects their standard of living.
3. The housing market: Demand for real estate has declined and construction of new homes is slowing down. These trends may continue as interest rates rise and real estate companies, including Compass and Redfin, have laid off workers pending a downturn in the housing market†
4. Start-up financing: Investments in start-ups have decreased to their lowest level since 2019, down 23 percent in the past three months to $62.3 billion.
5. The Scholarship: The S&P 500 had its worst first half year since 1970and it’s down almost 19 percent since January. Every sector of the index, except energy, has fallen since the start of the year.
6. Buyer: Seen by analysts as a measure of sentiment on the global economy – due to its widespread use in buildings, cars and other products – copper has fallen by more than 20 percent since January, hit a 17-month low on July 1†
7. Oil: Crude oil prices have risen this year, partly due to supply constraints caused by the Russian invasion of Ukraine, but lately they have begun to falter as investors worry about growth. The price of Brent oil, the global oil benchmark, fell below Wednesday $100 a barrel for the first time since the end of April†
8. The Bond Market: Long-term government bond yields have fallen below short-term yields, an unusual event traders refer to as a yield curve inversion† It suggests that bond investors expect an economic slowdown.