The International Monetary Fund issued on Friday its preliminary findings on the state of the United States economy following its official visit to the country, predicting annual GDP growth of 1.7% in 2023, followed by 1% next year. This slowing will likely be followed by an increase in unemployment to about 4.5% by the end of 2024. Turning to inflation, the IMF noted consumer prices will continue to decrease while warning inflation is expected to remain above the Federal Reserve’s 2% target range over the next two years.
“To bring inflation firmly back to target will require an extended period of tight monetary policy, with the federal funds rate remaining at 5.25–5.5% until late in 2024,” the IMF noted in a report published on its website.
Furthermore, the IMF also showed a scenario where the US economy would slow more abruptly, likely next year, creating a recession prompted by tighter monetary policy. In this case, the combination of high interest rates, a strong dollar, and a sharper slowdown in business activity would have significant negative macro-financial spillovers worldwide, the IMF warned.
Fed’s Mester: PCE inflation shows slow progress
Cleveland Federal Reserve Bank President Loretta Mester told CNBC on Friday that the latest figures on consumer expenditure in the United States show “slow progress” in policymakers’ efforts to curb inflation. “It’s concerning,” Mester stressed, pointing out that the Federal Reserve could lean towards more tightening in the coming period. “My path for the funds rate is not that we raise to some peak rate and then immediately start cutting,” she argued, but to leave elevated rates in the restrictive territory “for a time” in order to be absolutely certain that inflation is on a “sustainable” path to return to 2%. NN: the wall Street artificial intelligence spin machine is working overtime. They are desperate. Fear has no bounds. Its like a swat team blowing open the door on your crack house. There is no imminent artificial intelligence revolution. Their is not Fed tapering and they sure as hell will not be LOWERING rates any tine soon. I’ll tell you what is about to happen. The FED continues to raise rates until it throws he US economy into a recession some will call a depression. Oil will soar to the moon as oil supplies due to lack of investment and production cuts fail to keep up with demand. And we will SOON have a Artificial Intelligence Bubble Bust. Making the Dot Com market wipe out look like a food fight in the kindergarten. Are you ready to make a shit pot full of money?