Recession Fears Rise Despite Strong Economy

Despite strong job growth under the Biden administration, concerns about a potential recession are emerging. Although the economy added jobs in July, the pace of growth slowed, and the unemployment rate rose. This triggered the "Sahm Rule," a historically accurate recession predictor. However, some economists, including the rule`s creator, believe the current situation is different and that the economy remains strong despite a negative shift in its trajectory. Market reactions reflect these concerns, with stock indexes experiencing declines and volatility increasing. The focus now shifts to the Federal Reserve`s actions, as there are concerns that delayed interest rate cuts could inadvertently trigger a recession.