healthy backlog , according to Dodge Data & Analytics .
But growing odds of a recession are dampening that positive outlook .
The Biden administration and Federal Reserve have publicly conceded they made mistakes in their handling of inflation since the pandemic began , according to the Wall Street Journal .
And ABC ’ s Construction Confidence Index readings for sales , profit margins and staffing levels declined in May . That ’ s a reflection of lingering , worsening supply chain challenges , said Basu .
manufacturing and distribution , and there is little prospect for inflation to meaningfully subside during the weeks ahead .”
The Federal Reserve , in turn , will tighten monetary policy and raise interest rates , but that will suppress demand over the rest of the year , said Basu . Eventually , suppliers will then respond to diminished demand . That dynamic will “ quite likely drive the economy into recession either later this year or at some point in 2023 ,” said Basu .
On Wednesday , the Fed took another step in that direction , raising a key interest rate by 0.75 percentage points , its largest hike in 28 years .
“ Inflationary pressures show no signs of abating . For months , economists and others have been expecting inflation to peak and then subside ,” said Basu in his statement . “ Elevated energy prices are now circulating across the economy , affecting
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