SALT LAKE CITY — Despite the U.S. economy ending 2022 better than expected, some economists are still worried about a potential recession later in 2023.

Rep. Robert Spendlove (R-Sandy) is a senior vice president of public policy at Zion’s Bank. He joined Inside Sources hosted by Leah Murray and Scott Simpson to discuss the possibility of a recession and what to expect from the Federal Reserve in the coming months. 

Murray says last year felt like doom and gloom, and then at the end of the year everything is fine.

“Can you just explain to us what is happening with these numbers around the GDP (gross national product) growth?” she asks.

He says the GDP is the value of everything that is produced and sold in the country.

“And so, it really is kind of the main indicator of how the economy is doing,” Spendlove said. “And you know we’ve been seeing this overheating growth in the economy. That’s what we see with the inflation.”

He says the Federal Reserve has been trying to slow it down. Spendlove says it has slowed over the last month. However, it didn’t slow as quickly as many experts anticipated, according to Spendlove.

“We thought it was slow,” he said. “And it did slow. But not as much as we thought. So that what we’re seeing is the economy is just not slowing as quickly as we anticipated.”

Recession in 2023?

Spendlove says if the economy doesn’t slow fast enough, the Fed is going to continue to raise interest rates.

Simpson asked “What’s next? I mean are we going to continue to see Fed action as a result of this?”

Spendlove thinks the Fed will continue to take action. As such, he offers a data point to prove his point. 

He says if the economy is weakening, and we hear about all sorts of layoffs, jobless claims should be on the rise, right?

“This morning, the numbers came in for last week,” he said. “It went down, and it went down to pre-pandemic levels. So that sends the message to the Fed, you have to keep going. So, I think the Fed is gonna keep raising rates over the next few meetings, probably until June.”

He says rates will probably go up another half or three-quarters of a percent and then remain there for the remainder of the year. 

Simpson asked “Utah’s economy, is it still cooking with gas or are we moving in the right direction?”

“Utah has such a strong economy,” Spendlove said. “We have good economic fundamentals. We have a young, hard-working, well-educated workforce. (And) We also have a really good business environment and frankly, it’s just a great place to live until people want to move here.”

 

Inside Sources with Boyd Matheson can be heard weekdays from 1 p.m. to 3 p.m. on KSL NewsRadio. Users can find the show on the KSL NewsRadio website and app. 

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