US Economy Proves Stronger-Than-Expected in 2024

The US economy performed better-than-expected in 2024, with the International Monetary Fund (IMF) upgrading its growth forecast for the region, and the resilience may persist in 2025 as the Federal Reserve unwinds its restrictive policy.

IMF World Economic Outlook (October 2024)

According to the IMF, Advanced Economies are projected to grow 3.2% in 2025, with the US expected to expand 2.2%.

Source: IMF

Even though economic activity in the US is anticipated to slow in 2025, the IMF may continue to revise its growth forecast as the Federal Open Market Committee (FOMC) remains ‘committed to maintaining our economy’s strength by supporting maximum employment and returning inflation to our 2 percent goal.’

In turn, the FOMC may further unwind its restrictive policy in an effort to prevent a recession, and the strength in the US economy may carry into 2025 amid the upward revisions in the Atlanta Fed’s GDPNow model.

Atlanta Fed GDPNow Model

Atlanta Fed GDPNow 12182024

Source: Atlanta Fed

According to the model, the ‘estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2024 is 3.2 percent on December 18, up from 3.1 percent on December 17.’

In response, the FOMC may continue to adjust the forward guidance for monetary policy as ‘recent indicators suggest economic activity has continued to expand at a solid pace,’ and the central bank may stay on track to implement less rate-cuts in 2025 as ‘the median participant projects that the appropriate level of the federal funds rate will be 3.9% at the end of next year’ instead of the 3.4% forecast at the September meeting.

With that said, the stronger-than-expected US economy may continue to sway the Fed as Chairman Jerome Powell acknowledges that ‘it’s pretty clear we have avoided a recession.’

— Written by David Song, Senior Strategist

Follow on Twitter at @DavidJSong

 

Related Posts

© Reuters

Forex flows were light into payrolls data, BofA says, highlights positions at risk By Investing.com

Có thể bạn quan tâm Japanese Yen Eyes Wage Data EUR/USD Signal Today – 17/12: Germany Woes Hit (Chart) ATFX launches prop trading arm ATFunded US Dollar…

Forex Markets React to Speculation on Trump’s Economic Policies

Forex Markets React to Speculation on Trump’s Economic Policies

Có thể bạn quan tâm ForexLive Asia-Pacific FX news wrap: BoJ and RBA meeting minutes released Will EUR/USD hit parity in 2025? EUR/USD forecast remains bearish ahead…

EUR/AUD taps out, Wall Street could throw the ASX a lifeline (for now)

EUR/AUD taps out, Wall Street could throw the ASX a lifeline (for now)

Có thể bạn quan tâm Forex Signals Brief December 19: BOJ and BOE Follow the Hawkish FED Cut USD/CAD Outlook: Finance Minister’s Exit Shakes Loonie Euro Floats…

Dollar softens slightly amid gradual tariff pledge

Dollar softens slightly amid gradual tariff pledge

Có thể bạn quan tâm Nasdaq Forex Signal Today 13/01: Falls Hard (Video) US Dollar Ends the Year on a Strong Note USD/CAD Forecast: Dollar Rally Resumes…

GBP/USD Forex Signal Today 14/01: Bullish Rebound (graph)

GBP/USD Forex Signal Today 14/01: Bullish Rebound (Chart)

Có thể bạn quan tâm Weekly Pairs in Focus – December 22 (Charts) Asian Markets Mostly Trade in Negative Territory Holds Strong Near 0.90 (Video) Top Trades…

GBP/USD Price Analysis: Sterling Steady Ahead of US Inflation

GBP/USD Price Analysis: Sterling Steady Ahead of US Inflation

Có thể bạn quan tâm India’s Forex Reserves Decline by $1.98 Billion, Continue Downward Trend CAC 40 Forecast Today 16/12: Struggles Near 7,400 (Video) EUR/USD forecast remains…

Leave a Reply

Your email address will not be published. Required fields are marked *