The US economy has exceeded the Federal Reserve's estimate of its growth potential in recent years, with growth averaging 3% under President Joe Biden, but concerns about rising public debt and inflation, as well as the Fed's efforts to control them, may lead to slower growth in the future and potentially a recession. However, there are hints of improving productivity that could support continued economic growth.
The U.S. economy continues to grow above-trend, consumer spending remains strong, and the labor market is tight; however, there are concerns about inflation and rising interest rates which could impact the economy and consumer balance sheets, leading to a gradual softening of the labor market.
The Federal Reserve must consider the possibility of a reacceleration of the economy, potentially impacting its inflation fight, as retail sales in July were stronger than expected and consumer confidence is rising, according to Richmond Fed President Thomas Barkin.
Former St. Louis Fed chief James Bullard warns that stronger economic growth in the US may necessitate higher interest rates to combat inflation.
The Federal Reserve faces new questions as the U.S. economy continues to perform well despite high interest rates, prompting economists to believe a "soft landing" is possible, with optimism rising for an acceleration of growth and a more sustainable post-pandemic economy.
The US economy continues to perform well despite the Federal Reserve's interest rate hikes, leading to questions about whether rates need to be higher and more prolonged to cool inflation and slow growth.
U.S. economic growth, outpacing other countries, may pose global risks if the Federal Reserve is forced to raise interest rates higher than expected, potentially leading to financial tightening and ripple effects in emerging markets.
Global inflation pressures could intensify in the coming years due to rising trade barriers, aging populations, and the transition to renewable energy, posing challenges for central banks in meeting their inflation targets.
The US economy is expected to slow in the coming months due to the Federal Reserve's efforts to combat inflation, which may lead to softer consumer spending and sideways movement in the stock market for the rest of the year, according to experts. Additionally, the resumption of student loan payments in October and the American consumer's credit card debt could further dampen consumer spending. Meanwhile, Germany's economy is facing a recession, with falling output and sticky inflation contributing to its contraction this year, making it the only advanced economy to shrink.
The Federal Reserve is losing its power to influence the US economy, according to Wall Street economist Richard Koo, potentially requiring higher interest rates to drive inflation down and leading to a selloff in stocks and bonds.
Morgan Stanley's top economist, Seth Carpenter, believes that the US is nearing a dream economic scenario with falling inflation and steady growth, suggesting that the Federal Reserve is close to achieving a soft landing.
The U.S. economy may achieve a soft landing, as strong labor market, cooling inflation, and consumer savings support economic health and mitigate the risk of a recession, despite the rise in interest rates.
BlackRock's Rick Rieder suggests that the Federal Reserve can now end its inflation fight as the labor market in the US is cooling down after gaining 26 million jobs in the past three years.
The U.S. economy is defying expectations with continued growth, falling inflation, and a strong stock market; however, there is uncertainty about the near-term outlook and it depends on the economy's future course and the actions of the Federal Reserve.
The risk of inflation becoming entrenched is one of the biggest challenges facing the Federal Reserve, according to LPL Financial's Jeffrey Roach.
Despite recent optimism around the U.S. economy, Deutsche Bank analysts believe that a recession is more likely than a "soft landing" as the Federal Reserve tightens monetary conditions to curb inflation.
Bank of America warns that the US economy still faces the risk of a "hard landing" due to rising oil prices, a strong dollar, and potential interest rate hikes by the Federal Reserve, contrasting with the optimistic outlook of other Wall Street banks.
Economists predict that inflation will cool without a recession, as the effects of rate hikes have already taken shape, putting the US economy on track for a soft landing.
The U.S. economy is expected to expand at a 2.2% annual rate in the current quarter, according to a real-time estimate from the New York Federal Reserve, which is lower than the Atlanta Fed's estimate of 5.6% growth; the strength of the economy will impact the Federal Reserve's decision on interest rates and inflation.
S&P Global's chief economist, Paul Gruenwald, discusses soft economic landings, sticky inflation, the dash to decarbonize, and the emergence of India as key subjects of concern in the global economy.
The resilient growth of the US economy is fueling a rebound in the dollar and causing bearish investors to rethink their positions, although the currency's rally may face challenges from upcoming data and the Federal Reserve's meeting this month.
Treasury Secretary Janet Yellen and Goldman Sachs may be optimistic about a "soft landing" scenario for the US economy, but the author remains skeptical due to factors such as a deeply inverted yield curve, declining Leading Economic Indicators, challenges faced by the consumer, global growth concerns, and the lagging impact of the Fed's monetary policy, leading them to maintain a conservative portfolio allocation.
With 525 basis points' worth of cumulative Federal Reserve rate hikes in the books, the U.S. economy may still not be completely out of the woods, but signs are pointing to another positive performance for third-quarter real gross domestic product (GDP).
The Federal Reserve faces a critical decision at the end of the year that could determine whether the US economy suffers or inflation exceeds target levels, according to economist Mohamed El-Erian. He suggests the central bank must choose between tolerating inflation at 3% or higher, or risking a downturn in the economy.
The US economy shows signs of weakness despite pockets of strength, with inflation still above the Fed's 2% target and consumer spending facing challenges ahead, such as the restart of student loan payments and the drain on savings from the pandemic.
Despite economists' hopes for a "soft landing" of the economy, signs such as inflation and uncertain variables make it difficult to determine whether the U.S. economy has achieved this outcome.
Central banks' efforts to combat inflation by raising interest rates have not led to mass job losses, as labor markets in various countries have cooperated by reducing open vacancies and trimming wage growth, suggesting a possible "soft landing" for the economy without significant casualties.
The article discusses the current state of the economy and questions whether the "soft landing" explanation and belief in a full recovery are accurate, particularly in light of China's economic struggles and global inflation concerns.
Despite assurances from policymakers and economists, inflation in the US continues to rise, posing significant challenges to the economy and financial stability.
The upcoming U.S. Federal Reserve meeting is generating less attention than usual, indicating that the Fed's job of pursuing maximum employment and price stability is seen as successful, with labor market data and inflation trends supporting this view.
Global stocks eased as a drop in U.S. homebuilding highlighted the challenges the Federal Reserve faces in managing inflation, while oil prices rose and investors await rate decisions from major central banks.
Treasury Secretary Janet Yellen states that U.S. growth needs to slow to its potential rate in order to bring inflation back to target levels, as the robust economy has been growing above potential since emerging from the COVID-19 pandemic. Yellen also expects China to use its fiscal and monetary policy space to avoid a major economic slowdown and minimize spillover effects on the U.S. economy.
The Federal Reserve is expected to keep its benchmark lending rate steady as it waits for more data on the US economy, and new economic projections suggest stronger growth and lower unemployment; however, inflation remains a concern, leaving the possibility open for another rate increase in the future.
Investors are more focused on the release of new forecasts from the Federal Reserve, which will reveal their views on the prospect of an economic "soft landing" and the rate environment that will accompany it.
The Federal Reserve officials signal that they believe they can control inflation without causing a recession, with forecasts of higher economic growth and unchanged inflation outlook.
Federal Reserve Chair Jerome Powell indicates that while policymakers project a "soft landing" for the US economy, he does not confirm it as a baseline expectation due to external factors beyond their control such as the autoworker strike, government shutdown, and higher borrowing costs.
A stronger US dollar has a significant negative impact on emerging market economies compared to smaller advanced economies, as it decreases economic output and trade volume, worsens credit availability and capital inflows, tightens monetary policy, and leads to stock-market declines. Emerging market economies with anchored inflation expectations or flexible exchange rate regimes fare better, and global current account balances decline with a stronger dollar, reflecting a contraction in global trade. Measures such as global safety nets and macroprudential policies can help mitigate these spillover effects.
The Federal Reserve left interest rates unchanged while revising its forecasts for economic growth, unemployment, and inflation, indicating a "higher for longer" stance on interest rates and potentially only one more rate hike this year. The Fed aims to achieve a soft landing for the economy and believes it can withstand higher rates, but external complications such as rising oil prices and an auto strike could influence future decisions.
