California Economy: a Soft Landing, Or a Mild Recession?

The latest UCLA Anderson Forecast for California offers two potential scenarios for California’s economy — a soft landing led by such factors as more construction and increased demand for defense goods, or a mild recession with elevated unemployment rates.

The biggest source of uncertainty is tied to national economic policy.

“In the coming months, the Federal Reserve will reach that fork in the road between continued aggressive tightening and moderation,” the study said, “and it must decide which path to take.”

The good news?

Unlike the past four slowdowns in economic growth, UCLA predicts a milder impact on the Golden State’s economy whichever path the Federal Reserve decides to take.

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