As the Federal Reserve moves to cut interest rates at its September meeting, some investors believe the relief will be too little, too late, as the US is already headed toward a recession. HSBC chief US economist Ryan Wang joins Morning Brief to break down the likelihood of a recession as the Fed eyes its soft landing.

"The question is whether the labor market data are signaling something more worrying... And I think in the data, and anecdotally, we do not see evidence of that turn occurring just yet. But I think essentially markets are going to be somewhat nervous about this prospect for the rest of this year and into next," Wang explains. He notes that there has been resilient productivity growth over the last year, due to both technology improvements and workers being in jobs they're better suited for. He adds that the US economy is "actually benefiting" from the increased labor supply and productivity growth.

Wang highlights that some data is pointing to the Fed's soft landing. However, he explains. "I don't think there's any point — and I think FOMC policymakers would agree — that you can just declare victory. It just simply doesn't work that way." As the economy slows, there will be more challenges ahead, like slower income growth, for one. Thus, the Fed is figuring out the balance in "a never-ending quest to try to keep the economy on an even keel, even though if you can never achieve that perfectly."

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This post was written by Melanie Riehl