The Congressional Budget Office on Friday, December 15, released a forecast according to which the inflation rate in the United States will decrease next year.
The mentioned agency believes that in 2024, the growth in the cost of goods and services in the American market will approach the target of the Federal Reserve System, which is 2%. According to the experts of this organization, next year the United States will also experience a slowdown in economic growth. They predict a decrease in the level of activity in the American labor market.
The Congressional Budget Office expects personal consumption expenditures to decrease to 2.1% in the United States next year. It is predicted that this indicator, excluding energy and food costs, will be fixed at 2.4%. The agency also expects the figure to reach 2.3% in 2025. In this case, the experts focused on the economic changes that were recorded as of December 5 of this year.
The agency predicts that price pressures in the United States will ease next year amid a decline in consumer spending after a more stable situation in 2023. In this case, experts justify their point of view with expectations of improving supply conditions and reducing the cost of rent.
According to the Congressional Budget Office, economic growth in the United States will be recorded at 1.5% next year, which means a slowdown compared to the current pace of the corresponding process. The agency expects this figure to be 2.5% in 2025.
Also, analysts at the Congressional Budget Office predict a softening of conditions in the American labor market next year. At the same time, they forecast the unemployment rate in the United States to rise to 4.4% in 2024. In the last November report on employment in the United States, this figure was recorded at 3.7%. The agency’s analysts admit the possibility of an increase in the labor force over the next two years due to immigration.
The Congressional Budget Office also expects the gross domestic product of the United States to shrink by 1% next year and reach 1.5%. According to analysts, a decrease in consumer spending will entail a reduction in production volumes.
As we have reported earlier, Fed Signals Possibility of Rate Cuts.
Serhii Mikhailov
Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.
