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States Boost Reserves to Blunt Rising Inflation, Recession Fears

June 16, 2022, 4:01 AM

State budget officers are boosting their emergency reserves even higher, as they brace for a slowdown in economic growth in fiscal 2023 amid rising fears of a recession.

While state revenues have continued to perform better than expected since the start of the pandemic, forecasters are watching closely for warning signs the US economy could be headed for a recession as the Federal Reserve tries to restrain rampant inflation and the Russian-Ukraine conflict puts upward pressure on gas prices, according to the latest quarterly fiscal survey from the National Association of State Budget Officers released Thursday.