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Deutsche Bank forecasts US recession

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The Federal Reserve’s fight against inflation will spark a recession in the United States that begins late next year, Deutsche Bank warned on Tuesday.

The recession call, the first from a major bank, reflects growing concern that the Fed will hit the brakes on the economy so hard that it will inadvertently end the recovery that began just two years ago.

“We no longer see the Fed achieving a soft landing. Instead, we anticipate that a more aggressive tightening of monetary policy will push the economy into a recession,” Deutsche Bank economists led by Matthew Luzzetti wrote in the report.

That forecast is driven by red-hot inflation, with consumer prices rising at the fastest pace in 40 years. Hopes that inflation would rapidly cool off have been dashed, in part because of the war in Ukraine.

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Inflationary pressures have broadened out, raising concern that the Fed will have to rapidly raise interest rates to get prices under control. Deutsche Bank pointed to how energy and food commodity prices have spiked since Russia invaded Ukraine.
“It is now clear that price stability…is likely to only be achieved through a restrictive monetary policy stance that meaningfully dents demand,” the Deutsche Bank economists wrote.

In other words, the Fed can’t just tap the brakes on the economy. It needs to really slow the economy down.

Fed Governor Lael Brainard said Tuesday the Fed will need to “rapidly” shrink its balance sheet and “methodically” raise interest rates to cool off inflation. “It is of paramount importance to get inflation down,” Brainard said in a speech.

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Although Deutsche Bank cautioned there is “considerable uncertainty” around the exact timing and size of the downturn, it’s now calling for the US economy to shrink during the final quarter of next year and the first quarter of 2024, “consistent with a recession during that time.”
The good news is Deutsche Bank is not forecasting a deep and painful recession like the past two downturns.

Rather, the bank expects a “mild recession,” with unemployment peaking above 5% in 2024. That would still translate to considerable layoffs. During the Great Recession unemployment peaked at far higher levels of 14.7% in 2020 and 10% in 2009.
This coming recession would allow inflation to get back towards the Fed’s target by the end of 2024, Deutsche Bank said.

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“With the unemployment rate receding only slowly following the peak, inflation should continue to moderate, falling to the Fed’s 2% objective in 2025,” Deutsche Bank said.
Dimon sees a slowdown that ‘could easily get worse’
Others have recently warned of a growing probability of a recession, though they have mostly stopped short of predicting an outright downturn.

There is at least a one-in-three chance of a recession in the next 12 months, Moody’s Analytics chief economist Mark Zandi told CNN late last month. “Recession risks are uncomfortably high — and moving higher,” Zandi said.

Goldman Sachs has similarly said recessions chances have climbed to as high as 35%.
“The war in Ukraine and the sanctions on Russia, at a minimum, will slow the global economy — and it could easily get worse,” the JPMorgan Chase CEO Jamie Dimon wrote in his annual shareholder letter Monday, recalling that the 1973 oil embargo sent energy prices skyrocketing and pushed the world into recession.

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Fed Chairman Jerome Powell, on the other hand, pointed out in a speech last month that there have been instances in the past where the Fed was able to achieve a soft landing: Fighting inflation by raising rates without causing a recession. Powell pointed to 1965, 1984 and 1994 as examples.

However, the Fed chief also conceded there is no guarantee it will be able to pull off that feat this time.
“No one expects that bringing about a soft landing will be straightforward in the current context,” Powell said, “very little is straightforward in the current context.”

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ICYMI: ‘Go and bring husband to daddy,’ Ooni of Ife tells daughter at 30

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The Ooni of Ife, Oba Adeyeye Ogunwusi, has taken to social media to celebrate his daughter, Adeola, who turns 30 on May 20.

Ogunwusi, in his post on Monday, prayed to God to be with his daughter and asked her to bring a man home for marriage because she was ripe for it.

The revered monarch reeled out his expectations to her every 10 years, saying that when she was 10, he spoke to her about school and the future, and when she turned 20, it was about listening and understanding the importance of morals and well-being. But now that she is 30, she should bring a man home for marriage.

He wrote, “Princess Adeola, Aanuoluwapo, Atutunini, Bamdefe Ogunwusi, Omo Ojaja II. I am truly grateful for the fulfilling life you have lived. May God Almighty continue to be with you in all your endeavours. Amen!

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“When you turned 10, your father would talk to you about school and your future. At 20, he encouraged you to listen and understand the importance of morals and well-being, even as you sought independence.

“Now that you are 30, you are a grown woman. Your father senses that you no longer wish to be advised as independence has finally set in.

“I talked 10 to you and got your subtle independent behaviour in return. I talked 20 to you, and I still got your near-obvious independence behaviour in return. Now I’m talking 30 to a grown woman, so go and bring husband to daddy. With love from the throne of Oduduwa.

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“Congratulations, and may God continue to guide you in all your pursuits,” he wrote.

However, the post has been greeted by warm reception from Nigerians as some men have begun to show interest in the daughter of the revered monarch.

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One user on Instagram who identified with the handle, KaybabaofHouston, said, “Daddy, please tag her. Let us begin to show our interest in her.”

ArosoIbitoye said, “Awesome! I have handsome boys here who will be willing to be inlaw to the king, sir.”

Rydow said, “Men mount. Where is her handle? I have single friends who are serious.”

“I want to marry your daughter sir,” one Ronnietthreads wrote.

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Abuja shopping complex shut after assault on soldiers

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Officers of the Nigeria Army have reportedly shut Banex Plaza, a shopping complex located in the Wuse 2 area of the Federal Capital Territory, following attacks on some of its personnel over the weekend.

A trader at the nearby Emab Plaza, simply known as Mr Somto, confirmed this to our correspondent via phone call on Monday.

“Yes, Banex is locked down. We are not affected by it though. And some men of the army are here”, he said.

Another shop owner, who runs an Apple products store at the complex, who spoke to our correspondent on the condition of anonymity, also confirmed the development, adding that they were still in talks with the army.

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“No, we are not open. You know because of the issue that happened, the army has locked down the place. At each gate of Banex now, there is a Hilux vehicle, an army Hilux. They won’t even let you cross the place.

“But maybe between tomorrow and next, it will be open, we don’t know. We are still on it, having meetings with them”, he said

Theheute reports that the FCT Police Command on Saturday, deployed officers of the Intelligence Response Team to the area after a conflict ensued between traders and some soldiers.

A viral video seen by our correspondent on X showed a multitude of civilians overpowering some soldiers during a free-for-all at Banex.

The FCT Police Command, in a statement by its spokesperson, Josephine Adeh, later on Saturday night, said the police had restored peace in the affected area, adding that a buyer had gone with four soldiers to demand a refund after the purchased phone developed faults, which the shop owner resisted.

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“This action resulted in a confrontation and squabble with the military officer. This development led some irate youths to attack the military officer which led to an uproar in the environs”, the statement read.

Meanwhile, personnel of the Nigeria Army, in a reprisal, reportedly stormed the plaza on Saturday evening, beating passersby and manning guards, while a circulating video also showed the soldiers punishing some individuals.

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NDLEA declares India-based Nigerian couple wanted, arrests four cartel members

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The National Drug Law Enforcement Agency has declared a couple, Kazeem Omogoriola Owoalade and Rashidat Ayinke Owoalade, wanted for running a cocaine cartel from India.

This follows the arrest of four members of the syndicate in Lagos, where a Sports Utility Vehicle was recovered and two houses traced to them were sealed for forfeiture to the Federal Government.

This was made known in a statement signed by the agency’s Director of Media and Advocacy, Femi Babafemi, and shared on its website on Sunday.

The statement read, “A couple, Kazeem Omogoriola Owoalade (alias Abdul Qassim Adisa Balogun) and Rashidat Ayinke Owoalade (alias Bolarinwa Rashidat Ayinke), who runs a cocaine cartel from India has been declared wanted by the National Drug Law Enforcement Agency following the arrest of four members of the syndicate in Lagos where a Sports Utility Vehicle was recovered and two houses already traced to them sealed for forfeiture to the Federal Government.

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“Two members of the syndicate: Imran Taofeek Olalekan and Ishola Isiaka Olalekan were arrested on April 3, 2024 following their bid to export 3.40kg cocaine on a Qatar Airlines flight going to Oman through the Murtala Muhammed International Airport, MMIA Ikeja Lagos.

“While Imran was the courier conveying the drug consignment to Oman, Ishola recruited him for the head of the cartel, which investigation has now revealed to be Alhaji Kazeem Omogoriola Owoalade whose Indian residence permit bears Abdul Qassim Adisa Balogun based in India.

“Efforts to dismantle his network in Nigeria paid off after five weeks of surveillance and follow up operations when another member of the syndicate, Hamed Abimbola Saheed, who works directly with the baron was arrested on Tuesday 14th May at Abule Egba area of Lagos. It was indeed Saheed who lodged Imran in a hotel a day before his aborted trip to Oman and equally dropped him and Ishola at the Lagos airport the day they were arrested.”

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During a search of Hamed’s house, NDLEA operatives were said to have recovered some phenacetine, a cutting agent for Cocaine, weighing 900 grams.

He was said to have confessed that the recovered substance was what was left of the consignment Imran was taking to Oman the day he was arrested.

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His arrest led to a follow up operation at the home of the Owoalade couple at 20, Eyiaro Street, Ogudu Orioke, Lagos where another suspect was arrested and a new model Toyota RAV4 SUV marked FKJ-773 JJ belonging to Rashidat and additional 400 grams of Cocaine recovered in addition to already prepared suitcases to be used for illicit drug concealment, digital weighing scales and other paraphernalia.

NDLEA officers also intercepted two parcels at a courier firm in Lagos on May 15.

The parcels contained cocaine (587g) hidden in steel bolts bound for China and amphetamine concealed in vape pens and shea butter heading to the UK.

The statement added that an attempt to export 3.6kg of cannabis (loud strain) hidden in 36 water flasks to Dubai was foiled at a logistics company in Port Harcourt, Rivers State on May 16.

The owner of the consignment, Emeka Nwadiaro (aka Mega), was arrested in Onitsha, Anambra State, on the same day following a swift follow-up operation.

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The statement added, “While NDLEA operatives in Lagos intercepted a Mercedes Benz bus loaded with 840kg cannabis and arrested the driver, Samuel Henry, at Olojo in Ojo LGA, Lagos, another suspect, Lawal Adam was nabbed along Otukpo road, Aliade, Benue state on Friday 17th May with 75,000 pills of opioids including tramadol and exol-5. Two suspects: Olisa Etisi, 32, and Jonathan Umeh, 25, were arrested along Owerri – Onitsha road, Imo state following the discovery by NDLEA operatives of a big gas cyclinder used to conceal six blocks of Loud, a strain of cannabis weighing 3.85kg.

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“In Borno State, 70-year-old Adamu Mohammed was arrested at Mbulamel, Biu LGA on Thursday, 16th May with 2kg cannabis and 33.55grams of diazepam, while Gaddafi Sani, 27, was arrested with 30 kilograms of cannabis along Abuja-Kaduna road, Kaduna.”

NDLEA officers in Yobe State seized a large consignment of drugs from a petrol tanker on the Potiskum-Damaturu Road.

The drugs, which included 91.1kg of opioids and 13kg of cannabis, were hidden in secret compartments and were heading for Maiduguri, Borno State.

The driver, Ismaila Ali, was arrested in connection with the discovery.

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NDLEA officers also arrested four suspects in connection with the seizure of 2,025 pieces of improvised explosive devices (IED) materials in Niger State.

Two suspects, Abdulrauf Shitu Adeyemi and Asmiyu Rahim, were arrested on the spot, while Husaini Abdullahi and Nazifi Abdullahi were arrested in Sokoto and Kano respectively, following a follow-up operation.

The suspects and the explosive materials have been transferred to the appropriate security agency for further investigation. In a separate operation, Muhammad Lawal was arrested in Katsina state with 1,000 ampoules of Pentazocine injection.

A total of 105kg cannabis was on Friday, May 17, recovered from a house at Obola community, Owan West LG, Edo State, and a suspect, Gloria Oris, arrested when NDLEA officers raided the area.

In Kwara State, two suspects: Abdulganiyu Karaman, 55, and Sunday Abel, 37, were on Saturday 18th May arrested with 83kg cannabis and tramadol at Boriya, Baruten LGA, and Offa respectively.

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NDLEA officers also recovered 105kg of cannabis from a house in the Obola community, Edo state, and arrested a suspect, Gloria Oris, on May 17th. Additionally, two suspects, Abdulganiyu Karaman and Sunday Abel, were arrested in Kwara State on May 18, with 83kg of cannabis and tramadol.

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