Mnuchin: No Recession in the US, Focus Should Be on Market Declines

Former Treasury Secretary Steven Mnuchin assessed the current stock market downturn in an interview with Bloomberg on Thursday, suggesting that a correction of 5% to 10% in the S&P 500 and Nasdaq is reasonable given the fully priced market when his team took office. His comments came during a time of continuous selling pressure, pushing the S&P 500 Index toward its lowest close since September. Mnuchin discussed the impact of President Donald Trump's trade policies, including the threat of a 200% tariff on European alcoholic beverages.

Now at his company Liberty Strategic Capital, Mnuchin described the current situation as a "natural correction," noting that significant technology spending in artificial intelligence is influencing market performance. He acknowledged concerns about tariffs and their potential effects but advised investors to avoid overreacting, expressing confidence that the U.S. will not enter a recession. While he conceded a slowdown linked to reduced government spending, he dismissed fears of a recession and emphasized the urgency of addressing the U.S. fiscal deficit.