Fitch cuts US growth forecasts

Washington-Sana

The "Fitch" credit rating agency has lowered its growth forecast for the United States for this year and next, warning that the Federal Reserve's increase in interest rates, along with inflation, will push the American economy into a recession similar to what happened in 1990.

CNN quoted the agency as saying in a report that "US GDP is expected to reach only 0.5 percent next year, down from 1.5 percent growth in the agency's expectations for the month of June."

The report added: "High inflation will represent a large part of the depletion of household income next year, which will reduce consumer spending and in turn lead to a decline during the second quarter of next year."

Consumer prices in the United States increased more than expected last September, and core inflation pressures continued to rise, reinforcing expectations that the Federal Reserve will raise interest rates by 75 basis points next month.

Inflation still exceeds the Federal Reserve's 2 percent target, although restrictions continue to tighten as supply chains ease and oil prices have fallen from the highs seen this spring.

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