Jason Furman, chair of the Council of Economic Advisers under former President Obama, said on Sunday that he thinks a recession is “certainly possible,” but he is not as pessimistic as some other economic forecasters.
“I’m not that much more worried than I am normally,” Furman told CBS “Face the Nation” moderator Margaret Brennan.
“But I don’t have any confidence in that, in part because the economic signals are really unclear in the first half of the year,” he said.
Annual inflation ending in June hit a nearly 41-year high of 9.1 percent, with oil prices helping drive the surge.
Many economists have been increasing their predictions of a recession in recent weeks as the Federal Reserve rapidly raises interest rates to cool demand and stem inflation, pointing to supply-side constraints on commodities like oil that have been further strained by Russia’s invasion of Ukraine.
Furman on Sunday noted that job growth has continued even after the Fed’s recent rate hikes.
He also pointed to a decline in consumer sentiment while strong spending continued simultaneously, although consumer spending did fall in May when adjusted for inflation.
“It’s hard to square a lot of these contradictory signals right now,” Furman said.
Furman acknowledged that the risks of a recession are “certainly more likely” than they normally are, but he rejected the idea of a recession being a “foregone conclusion.”
That remark is on par with Biden administration officials, who in recent weeks have said a recession is “not inevitable” and have downplayed some economists’ projections.
“But I’m looking through a cloudy rearview mirror, trying to guess what’s going to happen ahead of us,” Furman told Brennan.