The US economy may experience a small economic contraction if the financial sector is able to avoid issues as the Federal Reserve raises rates to stem inflation, said Raghuram Rajan, a former governor of India’s central bank and ex-chief economist at the International Monetary Fund.
“The Fed basically thinks that it rather tighten too much, than tighten too little and then see inflation pick up and have to do it again,” Rajan, who’s now a professor of finance at the University of Chicago Booth School of Business said in an interview with Annmarie Hordern and Joe Mathieu on Bloomberg Television Thursday.
