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Don’t Forget! You Saw it in the
By The Lesko Financial Services Team
Adverti$$er
August 2022 #14277 Page #91
Third Quarter Challenges Slow Growth Forecasts for Rest of 2022
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he U.S. economy starts the third quarter with some strong challenges that rattled the ongoing recovery in Quarter 2 and are likely to filter through to the next few months. Among them are lingering inflation, the prospect of several additional aggressive Federal Reserve rate hikes, and pervasive fears about a possible recession. Even filtering out the common wisdom that the news thrives on the negative, there are realities that are hard to ignore simply because of their day-to-day effect on all of us as we fill up our gas tanks and check off our grocery lists. Lingering uncertainty has resulted in tumultuous markets, slower growth forecasts, belttightening, an economy showing signs of gradual cooling, and recession jitters. Memories of past slowdowns have cast a pall over Wall Street and Main Street. But the current negative indicators are generally understood to be caused by the massive shift from pandemic shutdowns as global and domestic economies continue to gear back up. Now that we’re just past the midpoint of the year, here are the main headwinds ahead for the Third Quarter.
Inflation Inflation soared to 9.1% in June—a 40year high and more than expected. Households paid more for energy, groceries, and housing, including rentals. High fuel costs are also causing a ripple effect which adds to the cost of delivery and increases consumer prices. Lingering inflation has eroded some people’s wage increases and pandemic savings. Supply vs. demand and supply chain issues are still concerns and economists expect they’ll need more time to even out. Some economists are forecasting that inflation may have peaked, especially since there was some easing of gas prices as the Fourth of July holiday began. The drop at the pump was largely due to decreasing crude oil prices over recession fears, the release of some oil reserves, and competition among gas stations. Supply vs. demand and supply chain issues are still concerns and need more time to even out. But high fuel costs are also causing a ripple effect which adds to the cost of delivery and increases consumer prices. Continued next page
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