U.S. media: Federal Reserve report warns of credit crunch, U.S. recession risk intensifies – Xinhua English.news.cn

Overseas Network, May 9th. The US Political News Network issued an article on the 8th, saying that the latest report released by the Federal Reserve shows that the US has begun to experience a credit crunch, which may lead to a recession in the US economy and greatly increase the risk of a hard landing.

On May 8, local time, the Federal Reserve released a report on the health of the U.S. financial and economy. Wall Street is watching closely for signs of a recession after a survey of banks by the Federal Reserve showed that standards for lending to commercial, industrial and commercial real estate are expected to tighten and demand for loans will weaken.

Another survey report released in January this year showed that bank lending standards in the United States were already at levels consistent with past recessions. Further tightening within the month, other mid-sized banks are also under intense pressure from investors.

Part of the reason for the banking crisis is that the Federal Reserve has continued to raise interest rates in order to combat inflation. The impact of interest rate hikes is beginning to spread to the entire US economy, dragging down industries such as real estate. The Federal Reserve’s report on the 8th showed that the credit contraction that may be triggered by the continued pressure on banks is one of the major risks facing the US financial system in the near future. The rise in corporate financing costs will bear the brunt of the impact, and the risk of a hard landing of the economy has increased.

Wall Street is very concerned that the Fed’s aggressive interest rate hike campaign will slow U.S. economic activity and trigger a recession. Many economists predict that the U.S. economy could slip into a recession later this year and last until 2024.