Investors are on edge as troubling signs emerge in the U.S. economy. The growing threat of stagflation, where inflation soars while jobs disappear, has them bracing for the worst. The Federal Reserve’s latest economic projections contributed to an 8% slump from an all-time high in the S&P 500 index. According to RSM Chief Economist Joe Brusuelas, we may be heading into a period of “stagflation-lite.” A potentially disastrous situation for retirement savings.
The Federal Open Market Committee (FOMC) recently downgraded its economic growth outlook. They are predicting only a 1.7% expansion this year. That’s a 0.4 percentage point decline from its December forecast. At the same time, the committee raised its inflation expectations. Signaling uncertainty in its economic outlook.
