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23 Jan 2023

Recession Indicator: US interest rate cycles

Economic history tells us that every time the United States begins increasing interest rates a recession follows afterwards more than 50% of the time.

The market believes that Jerome Powell, Chair of Federal Reserve is going to continue to increase interest rates to slow down the rate of inflation but it is coming to an end.

Click for chart.

Increasing interest rates should not be an investor’s focus.

Benjamin Graham taught that it is the buy price that matters when investing and now is a good time to buy beucase asset prices are discounted.

If a recession does follow in the United State then it will become an even better time for investors to buy more quality asset at a discounted price.

WARNING, this does not constitute Personal Advice. To discuss if this is an appropriate strategy for your given circumstances please do not hesitate to contact us directly.

If you have family, friends or colleagues that want financial advice please ask them to contact us and we will work out how best to help.


At Newealth we are always looking to support and promote our clients wherever possible and if you have any ideas or comments, please feel free to email me or to call me on +61 2 9267 2322.

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