While he expects weak growth in the near term, with the economy picking up later this year, Federal Reserve Bank of Richmond president Jeffrey Lacker said Friday that if business spending slows this year, it could lead to a recession.

“With the strains in housing persisting, a substantial slowdown in business spending could raise the odds of a recession. This risk would be heightened if December’s job market weakness proved persistent, pulling down prospects for personal income and household spending,” Lacker said in a speech to the Risk Management Association in Virginia, according to prepared text released by the Fed. “Nevertheless, I believe the most likely outcome is for growth to continue and to improve.”

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