After a huge year for growth, the U.S. economy is about to slam into a wall - Printable Version +- Ipoh Community Forums (https://forums.ipoh.com.my) +-- Forum: News and Current Affairs (https://forums.ipoh.com.my/forum-11.html) +--- Forum: International News (https://forums.ipoh.com.my/forum-13.html) +---- Forum: Business, Economy and Investment (https://forums.ipoh.com.my/forum-56.html) +---- Thread: After a huge year for growth, the U.S. economy is about to slam into a wall (/thread-4701.html)

After a huge year for growth, the U.S. economy is about to slam into a wall - superadmin - 02-02-2022 The U.S. economy last year grew at its fastest pace since 1984, but that momentum isn’t carrying into 2022. An inventory build fueled most of the second-half growth that put annualized GDP up 5.7% for the year. In the first quarter, the economy may not show any gain at all and possibly show a loss in GDP. The pandemic, along with declining help from fiscal and monetary policy, will keep growth in check. Spurred by a massive inventory rebuild and consumers flush with cash, the U.S. economy last year grew at its fastest pace since 1984. Don’t expect a repeat performance in 2022. In fact, the year is starting with little growth signs at all as the late-year spread of omicron coupled with the ebbing tailwind of fiscal stimulus has economists across Wall Street knocking down their forecasts for gross domestic product. Combine that with a Federal Reserve that has pivoted from the easiest policy in its history to hawkish inflation-fighters, and the picture has suddenly changed substantially. The Atlanta Fed’s GDPNow gauge is currently tracking a first-quarter GDP gain of just 0.1%. “The economy is decelerating and downshifting,” said Joseph LaVorgna, chief economist for the Americas at Natixis and former chief economist for the National Economic Council under then-President Donald Trump. “It’s not a recession, but it will be if the Fed tries to get too aggressive.” GDP surged at an impressive 6.9% in the fourth quarter of 2021 to close out a year in which the measure of all goods and services produced in the U.S. increased 5.7% on an annualized basis. That came after a pandemic-induced 3.4% decline in 2020, a year that saw the steepest but shortest recession in U.S. history. But the path ahead is less certain. - More -