Mark Zandi, the Chief Economist at Moody's Analytics, has issued a stark warning regarding the fragility of the U.S. economy, stating it is growing at a rate below its potential. He noted that while the economy is projected to grow by approximately 2% in the second quarter, this growth is insufficient to prevent rising unemployment and inflation. Zandi highlighted that unemployment has crept above 4%, with job growth stagnating since April 2025, and a notable decline in labor-force participation, particularly among older workers. The inflation rate, currently above 3%, poses a challenge for the Federal Reserve, limiting its options for interest rate cuts. Zandi cautioned that geopolitical factors, including the ongoing conflict involving Iran, are exacerbating inflation and undermining economic stability. He believes that while a recession is not inevitable, avoiding one will require an end to the Iran conflict and continued growth fueled by artificial intelligence. Zandi's insights underscore the precarious state of the economy, which, despite its resilience, faces significant risks.