Citigroup CEO: Europe More Likely to Head Into Recession Than US

Reuters reported that Jane Fraser, CEO of Citigroup, warned Friday about the state of the global economy. Citi is America’s third-largest bank and has the most global focus.

At an investor conference in New York she spoke about the ‘three Rs’ that are affecting global economic growth. She stated: “It’s rates. It’s Russia. And it’s recession.

Fraser stated that Europe’s energy issues are having an effect on many companies in certain industries. Fraser explained that some companies are closing down because of rising electricity prices and energy costs. Citi executive stated:

Europe felt much more likely to enter recession than the U.S.

In order to combat inflation, major central banks have already begun planning interest rate increases and are preparing for the global first round of quantitative tightening. This move will likely reduce credit and increase stress in an already slowing global economy.

Fraser commented on the European Central Bank’s (ECB) actions, saying: “It feels like that the ECB has a few months behind the Fed in getting its arms around the inflation and without quite as much flexibility as the U.S. has.’

Fraser stated that the U.S. is asking more about interest rates and not recession. She noted, however, that the U.S. will have to be able to avoid a recession.

While it is not the base case, it is not impossible to avoid.

Jamie Dimon, CEO of JPMorgan Chase, stated Wednesday that an economic’Hurricane’ was coming to us, and advised investors to be prepared for its impact.

John Waldron , President and Chief Operating Officer at Goldman Sachs, warned about unprecedented economic shocks. He also predicted tougher times ahead.

Elon Musk, Tesla CEO, stated that he has a “very bad feeling” about the economy. This prompted President Joe Biden’s response. Musk stated that we could be in a recession for 12-18 months.