CHARLOTTE — Wells Fargo & Co.’s expectations for a recession later this year have run headlong into a stronger-than-expected economy.
The San Francisco-based bank’s economists now anticipate the nation will slip into a mild recession in the first quarter of 2024, with the Federal Reserve starting to cut interest rates in next year’s second quarter.
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The strength of the labor market and consumer spending spurred the Wells Fargo economists to adjust their outlook.
“Over the past year, many economists — ourselves included — have expected the Fed’s rapid tightening cycle to spur a pullback in economic activity that elicits a downturn,” Wells Fargo told clients on June 7. “While we still expect the delayed effects of monetary tightening and tighter credit availability to dampen economic growth, the economy has proven to be more resilient than we anticipated.”
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