US
The US economy maintained surprising strength in 2023 with 2.5% real GDP growth. The Q1 forecast update for 2024 revised real GDP growth upward 0.7 percentage points to 1.5%, but projections remain slower than recent years. Robust consumer spending and labour market resilience will partially offset the effects of tight monetary policy.
In Q4 2023, inflation increased for the first time in three months, but core inflation (excludes food and energy) fell to the lowest rate since May 2021 at 3.9%. The latest data puts inflation at 2.7% for 2024—a marginal upward revision from last quarter—but the downward trend continues, decelerating from 4.1% in 2023.
Labour market strength and economic resilience are critical factors that will decide the trajectory of inflation in the quarters ahead. Price pressures should weaken as demand slows and the labour market softens. Business and consumer confidence are also expected to recover as the US economy stabilises.
The outlook for the US economy remains uncertain this year. Domestic and global downside risks threaten economic growth, inflation and monetary policy.
US: Q1 2024 Forecasts
Source: Euromonitor International Macro Model
Note: Annual rates in percentages. Revisions in percentage points.
