The risk of an economic hard landing is on the rise, says an barclays economist.
The U.S. economy is now at an increased risk of having a “hard landing,” according to economists at Barclays.
Using language usually reserved for discussing the economic outlook in China, Barclays’ Michael Gapen writes in a note Tuesday that in the wake of tax cuts the “risks of a hard landing are rising” for the U.S. economy.
“We believe that tax cuts will stimulate household spending faster than business investment can improve productivity and, as a result, some of the output growth in our forecast will be accomplished through additional hiring,” Gapen said.
“We see the unemployment rate drifting lower over the course of the year, raising alarms in some corners of the [Federal Open Market Committee] about future inflation pressures or, more likely, financial stability concerns.”