March 29, 2023
A Credit Crunch Is the Last Thing the Strained US Economy Needs
The biggest banking scare since the 2008 financial crisis will ricochet through the economy for months as households and businesses find it harder to gain access to credit.
That’s the scenario facing the US after the collapse of three regional lenders, and a giant global one, over an 11-day span, according to several economists. Federal Reserve Bank of Minneapolis President Neel Kashkari, in a March 26 interview on CBS’s Face the Nation, said the turmoil “definitely brings us closer” to a recession and noted that officials are closely watching for signs of a widespread credit crunch.
Next Chapter in Europe’s Energy Crisis — Summer Risks for Gas
Europe has negotiated through the winter of a crisis that threatened to choke energy supplies and overwhelm its economy, but officials are warning that the squeeze may not yet be over.
Fears of blackouts and freezing homes have faded for now, and gas reserves remain far fuller than normal. The region is entering a crucial period of replenishing those stockpiles, and avoiding a crunch next winter hinges on its success. It won’t be able to rely on the usually massive supply of pipeline gas from Russia, and EU officials are leaning on companies to end LNG imports from the country.
China’s Economic Planning Official Sees Risks to Global Growth, Inflation
China is facing a more challenging global economic environment as growth slows and countries like the US struggle to contain inflation, a senior official at the nation’s economic planning agency said.
Global growth lacks momentum and downward pressure is rising, Zhao Chenxin, vice chairman of the National Development and Reform Commission, said at the Boao forum in Hainan on Wednesday. It’s very uncertain whether the US and Europe can curb inflation, he added.
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