A combination of persistent inflation, rising interest rates and a slowdown in global economic growth forced Fannie Mae to reduce this year’s GDP growth rate.
Fannie Mae’s Economic and Strategic Research (ESR) Group dropped its projected 2022 real GDP to 1.3%, 0.8 percentage points lower than its previous forecast. It sees the second quarter of growth rebounding to 1.6%, despite the economy contracting 1.4% in the first quarter.
Fannie Mae said the economy is slowing faster than previously expected as markets adjust to the Federal Reserve’s tightening monetary policy and are unlikely to result in a “soft landing.”
“Uncertainty details ⇒
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