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Economic growth persists in the US

During the last quarter of 2024, the economy of the United States grew at an annualized pace of 2.3%, according to the Bureau of Economic Analysis. This expansion rate was below the expected 2.6% and signaled a slowdown compared to the 3.1% increase noted in the previous quarter.

Main Factors Contributing to Economic Expansion

Key Drivers of Economic Growth

Analysis Compared to Earlier Quarters

Comparative Analysis with Previous Quarters

The 2.3% growth rate in Q4 represents the slowest quarterly expansion since 2018, when the economy grew by 0.6% in the fourth quarter. On an annual basis, the economy grew by 2.8% in 2024, slightly below the 2.9% growth recorded in 2023.

Numerous factors played a role in the tempered growth seen in the fourth quarter:

Several elements contributed to the moderated growth in the fourth quarter:

  • Investment Decline: There was a decrease in investment activities, which partially offset the gains from consumer and government spending.
  • Trade Dynamics: Imports decreased during this period, which, while a subtraction in GDP calculation, indicates potential shifts in domestic demand and global supply chain adjustments.

Inflationary Pressures and Policy Implications

Summary of the Labor Market

Labor Market Overview

Perspectivas para 2025

Mirando al futuro, las perspectivas económicas para 2025 muestran un panorama mixto:

Looking ahead, the economic outlook for 2025 presents a mixed picture:

  • Growth Projections: The Congressional Budget Office (CBO) projects a moderation in economic growth, with GDP expected to increase by 1.9% in 2025, down from an estimated 2.3% in 2024.
  • cbo.gov
  • Inflation Expectations: Economists anticipate that inflation will remain above the Federal Reserve’s 2% target, influenced by factors such as ongoing supply chain disruptions and policy decisions.
  • reuters.com
  • Policy Considerations: Proposed tariffs and stricter immigration policies could exert additional inflationary pressures and impact labor market dynamics, necessitating careful monitoring and policy adjustments. 
By Peter G. Killigang

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