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Allianz, one of the world’s biggest insurance companies, has actually cautioned that the U.S. economy is headed towards a crash landing. “We expect the economic momentum to deteriorate during the second half of the year on the back of rapidly tightening credit conditions, exacerbated by the banking crisis,” stated the insurance coverage giant’s experts.

Crash Landing Ahead, Warned Allianz

Allianz’s research study and analysis department released a report recently mentioning that the U.S. economy is “headed towards a crash landing.” Allianz is one of the world’s biggest insurance companies with over 122 million personal and business consumers around the world and more than 159,000 workers. It is headquartered in Munich, Germany.

“Negative confidence effects from the near-death experience in the U.S. banking sector and the unresolved energy situation in Europe will shape the rest of the year,” Allianz’s experts started. While keeping in mind that the U.S. economy “picked up pace in early 2023,” they worried that this revival will likely be “short-lived.” The experts continued:

We anticipate the financial momentum to weaken throughout the 2nd half of the year on the back of quickly tightening up credit conditions, intensified by the banking crisis.

Several significant banks in the U.S. stopped working just recently, consisting of Silicon Valley Bank and Signature Bank. The Federal Reserve and the Treasury took actions to avoid a systemic crisis, consisting of supplying liquidity to the banking system, producing a brand-new loaning center to supply short-term loans to banks, and guaranteeing all deposits of both banks.

“We project a sizeable recession in the U.S. (‘hard landing’) at the end of the year due to increasingly entrenched negative confidence effects, with a slowdown in housing, manufacturing, and construction as interest rate hikes further increase borrowing costs and dampen investment,” the Allianz experts even more detailed in the report.

A number of individuals have actually likewise cautioned that the U.S. economy is headed towards a crash landing. Prominent economic expert David Rosenberg anticipated an economic crisis and a crash landing in March based upon information from the Federal Reserve Bank of Philadelphia. Rich Dad Poor Dad author Robert Kiyosaki also cautioned of a crash landing as federal bailouts followed the banking crisis. Meanwhile, billionaire Barry Sternlicht expects a difficult landing for the U.S. economy.

What do you consider the caution by insurance coverage giant Allianz about a crash landing? Let us understand in the comments area below.

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