Deutsche Bank sign|Ell brown|CC BY 2.0
Deutsche Bank became the first big bank to predict that the Federal Reserve's fight against inflation may lead the US economy into recession by late next year.
The bank forecasts it to be a mild recession that will be short-lived and be over by the first quarter of 2024.
The report released by Deutsche Bank economists, led by Matthew Luzzetti, also predicted that unemployment would peak above 5% in 2024 (compared to 14.7% in 2020 and 10% in 2009).
Glimmer of hope
The predicted recession would help bring inflation down to Fed's target by the end of 2024.
“With the unemployment rate receding only slowly following the peak, inflation should continue to moderate, falling to the Fed’s 2% objective in 2025,” Deutsche Bank said.
