The Business Times
business-time-50
THE BROAD VIEW
·
SUBSCRIBERS

A soft landing won’t mean the economy is safe

Even a “Goldilocks” Fed will have to deal with the three bears of inflation, disease and politics

google-preferred-sourceAdd BT as a preferred source
    • In the United States, a divided Congress and a weak Speaker of the House of Representatives will be less likely to be able to pass budgets and cut spending as needed.
    • In the United States, a divided Congress and a weak Speaker of the House of Representatives will be less likely to be able to pass budgets and cut spending as needed. PHOTO: REUTERS

    DeeperDive is a beta AI feature. Refer to full articles for the facts.

    Allison Schrager

    Published Fri, Jan 13, 2023 · 09:00 AM

    SINCE we gave up on the idea that high inflation would be transitory, the hope has been that we would manage a soft landing: Inflation would melt back to 2 per cent without doing too much harm to the labour market or economic growth.

    That’s what the Federal Reserve has predicted for months, even as economists warned it was extremely unlikely. Now it seems a soft landing is a real possibility. Inflation is falling, and the labour market remains strong with unemployment at a 50-year low and wage growth of 4.6 per cent.

    If these trends continue, the “immaculate disinflation” the Fed projected will become a reality. But don’t celebrate yet. That won’t mean we dodged a bullet.

    Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.

    US economyInflation

    Share with us your feedback on BT's products and services

    Feedback

    TRENDING NOW

    Air India has been one of the foreign carriers most affected by the outbreak of hostilities in the Middle East.

    Air India asks Tata, Singapore Airlines for funds after US$2.4 billion loss

    Chinese Foreign Minister Wang Yi stopped short of explicitly naming the US or Israel as aggressors, a telling omission from a country that otherwise speaks with little diplomatic timidity.

    Beijing’s calculated silence on the Iran war 

    US President Donald Trump (left) with Chinese President Xi Jinping at a bilateral meeting on the sidelines of the Apec summit in Busan last October.

    China pips the US if Asean is forced to choose, but analysts warn against reading it like a sports result

    Eu Yan Sang group chairman Richard Eu has been with the company since 1989 and has seen plenty of change over the years, such as how employees view their jobs.

    Richard Eu on how core values, customers keep Singapore’s TCM chain Eu Yan Sang relevant

    Latest T-bills Treasury Bills Results & Interest NewsLatest SSB Singapore Savings Bonds NewsLatest COE Certificate of Entitlement News
    Latest Johor-Singapore SEZ NewsLatest BTO Build To Order & Sales of Balance NewsLatest STI Straits Times Index NewsLatest SGX Dividends, Share Price NewsLatest Bonds Market NewsLatest Singapore Stocks To Buy NewsLatest Singapore Economy News
    View More