Amid the ongoing geopolitical shift brought about by the BRICS economic alliance, America’s 4th largest bank has warned of an impending economic crash. Specifically, Citigroup’s chief US economist, Andrew Hollenhorst, has spoken with CNBC regarding his concerns for the United States and its economic fragility.
Hollenhorst discussed his concerns, specifically regarding the labor market. He noted that the deterioration of the hiring sector could have dire implications for the country. Ultimately, he spoke on why a hard landing may be all but an inevitability for the nation.
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Citigroup Warns of Potential Economic Crash
Over the last year, the BRICS economic alliance has observed significant growth. Not only has the bloc embraced its first expansion initiatives since 2001, but it has also embraced alliance-wide economic policies. These infrastructure developments hinder international reliance on the US dollar while promoting local currency use.
Now, the geopolitical shift that the BRICS bloc has orchestrated may be playing a part in America’s 4th largest bank warning of an impending economic crash. Specifically, Citigroup’s Andrew Hollenhorst noted that a hard landing is likely in the cards.
“Firms are hiring at a lower rate. Firms are having workers work less hours,” Hollenshorrts told CNBC. “So this gradual softening has already started. That tends to snowball and end up in something that looks more like a hard landing.”
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Moreover, Hollenhorst noted that some reports have expressed a more concerning view of the economic circumstances. Additionally, he noted that a recession could be set to follow any hard landing that takes place. Specifically, he notes that small businesses have displayed the lowest levels of hiring intentions since 2016.
Furthermore, the hiring rate is at its lowest level since 2014, Hollenhorst stated. Therefore, the labor market’s reality coincides with the overall interest rate issue, inflation persists, and optimism does not appear to be a logical response.
All of this will also contend with the ongoing US dollar questions that have arisen in recent months. The BRICS alliance has driven a global shift toward gold and other assets. Therefore, ongoing debt concerns and de-dollarization initiatives will only increase pressure on the US in its most dire state.
