The US economy grew by 2.8% According to gross domestic product (GDP) statistics released by the Bureau of Economic Analysis (BEA) on Thursday, the global economy is expected to recover in the second quarter of 2024.
Growth in the first quarter of 2024 was low, but growth in the second quarter was 1.4% After being revised downwards initial GDP is expected to grow by 1.6%, according to the BEA. Economists say GDP is expected to grow by 1.6%. The surrounding area By the second quarter of 2024, it will reach 2.1%, which is in line with typical U.S. economic growth rates.
The Federal Reserve has been trying to slow the economy by keeping the target range for the federal funds rate at 5.25% to 5.50%. The highest level since 2001. Federal Open Market Committee (FMOC) in June meeting Marked Number 7 The Fed opted not to adjust interest rates, leaving borrowing costs high for consumers and businesses. (Related: America's astronomical home prices could get even worse if Biden gets his way, experts say)
Federal Reserve Chairman Jerome Powell testifies during a hearing of the U.S. House of Representatives Select Committee on Oversight and Reform on Capitol Hill in Washington, U.S., June 22, 2021. (Graham Jennings/Pool via Reuters)
The Federal Reserve is keeping the federal funds rate at its current level to combat rising inflation in June. Despite declining 0.1% month-on-month, inflation rose to an annual rate of 3.0% in June, well above the Fed's 2% target. Excluding energy and food, inflation remained elevated at 3.3% year-on-year in June compared to 3.4% in May.
If inflation remains high, it could be harder to justify rate cuts that would lower borrowing costs and spur economic growth. With the economy slowing, most investors are currently expecting a 0.25% rate cut at the Fed's September meeting. according to to CME Group's FedWatch tool.
The unemployment rate rose slightly to 4.1% in June. The U.S. economy added 206,000 nonfarm jobs, but the lion's share of the growth was in the government sector, which added 70,000 new jobs. Federal Reserve Chairman Jerome Powell said in congressional testimony on Tuesday that the job market appears to be cooling, raising hopes that an interest rate cut is on the way. according to To Reuters.
The BEA said the 2.8% figure is a preliminary estimate and will be updated as more data becomes available.
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