U.S economy is not heading for a recession, says Bank of America CEO

Despite last week's meltdown in the US stock market and an increase of 4.3% in unemployment, CEO of Bank of America, Brian Moynihan, has said that he has not seen a recession on the horizon of the US economy, reports 'The Hill'. Participating in CBS’s Margaret Brennan on “Face the Nation” Sunday, he tried to defend Joe Biden and the Federal Reserve by indicating that they have managed a “soft landing” for the US economy after inflation troubles in recent years.

Bank of America CEO: No sign of recession

He said that his team is a great team at Bank of America Research, and it did not find any recession predicted anymore. He recalled that it was a recession by this time last year. Elaborating on his point, Moynihan said the consumer spending rate stands at about 3 percent, about half of what it was last year. He admitted that the consumers are feeling the pressure of high interest rates, though signs are still positive.

Brian Moynihan: Consumers have slowed down

The Bank of America CEO said further the consumer has slowed down. He said further they have money in their accounts, but they’re depleting a little bit.” Defending the economic condition of the country he said the consumers are employed, they’re earning money, but they are slowed down.


Moynihan said the Federal Reserve has to be careful to see that it does not slow down too much. According to 'The Hill', Bank of America has predicted two Fed interest rate cuts this year, one at next month’s meeting and one in December. It has also predicted that there may be four interest rate cuts in 2025.

When will Federal Reserve cut interest rates?

The Fed opted not to cut rates at its July meeting, going against market predictions. However, Chairman Jeremy Powell was quick to hint at slashing the interest rates in September. However, most of the people who keep an eye on the Fed, have said that it is likely to hold an emergency meeting before September to announce a cut in the bank rates.

FAQs

What has the Bank of America CEO said about the US economy?
CEO of Bank of America, Brian Moynihan, has said that he has not seen a recession on the horizon of the US economy. Elaborating on his point, Moynihan said the consumer spending rate stands at about 3 percent, about half of what it was last year. He admitted that the consumers are feeling the pressure of high interest rates, though signs are still positive.

What happened to bank interest rates?
The Fed opted not to cut rates at its July meeting, going against market predictions. However, Chairman Jeremy Powell was quick to hint at slashing the interest rates in September. However, most of the people who keep an eye on the Fed, have said that it is likely to hold an emergency meeting before September to announce a cut in the bank rates.