Risks to the Downside Are Mounting
October 14, 2014 – CHICAGO–(BUSINESS WIRE)–In the October issue of Themes on the Economy®, Mesirow Financial’s Chief Economist says a chill is settling over the economic outlook for 2015. Diane Swonk points overseas for the causes. “Everything from geopolitical tensions in the Ukraine, to ongoing weakness in Europe and stumbles by Japan and China, could take a toll on U.S. growth.” She says that “our trading partners are looking for us to act as Atlas, and support their economies on the backs of U.S. consumers… (but) the U.S. consumer is not as strong.”
What is strong now will weigh on American manufacturers who sell their products around the world. Swonk says that “a strong dollar is also costly to the U.S. economy, as it will intensify import competition and slow the pace of exports.” That in turn could delay a return to traditional monetary policy and higher interest rates. After laying out plans to gradually raise rates, “the last thing the Federal Reserve wants to do is reverse course once it has shifted to tightening monetary policy,” as Diane Swonk explains.
For more on how a slowing global economy is changing our forecast for U.S. growth, read Themes on the Economy for October. Archived issues can be found at mesirowfinancial.com.
Mesirow Financial is a diversified financial services firm headquartered in Chicago. Founded in 1937, it is an independent, employee-owned firm with approximately 1,200 employees globally. With expertise in Investment Management, Global Markets, Insurance Services and Consulting, Mesirow Financial strives to meet the financial needs of institutions, public sector entities, corporations and individuals. For more information, visit mesirowfinancial.com.