July 02, 2024 13:18 GMT
U.S. Macro Signal - July 2024: Domestic Engine Humming A Little Less Strongly
MNI's inaugural U.S. Macro Signal offers an in-depth look at the latest economic trends and what they mean looking ahead
EXECUTIVE SUMMARY
- After a booming second half of 2023, US domestic demand has moderated but remained solid so far in 2024.
- Household savings accumulated during the pandemic have mostly been exhausted, growth-positive fiscal impulses are waning, and the labor market has moved into better balance compared with previously very tight conditions.
- But with inflation showing inconsistent progress in returning to 2% and growth remaining at or above potential, the timing of the elusive first Fed rate cut keeps getting pushed back.
- Current forecasts for the second half of 2024 point to diminished domestic demand, including weaker consumer spending and private investment, but core inflation remaining elevated.
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