Not a decline in gross domestic product, but only a significant slowdown in its growth. This is how one of the local investment banks Morgan Stanley sees the development of the US economy next year. Restrictive policies will continue to hamper growth in 2024.
US still has a chance to avoid recession
The slowdown in gross domestic product growth in 2023 will indeed be significant in the US. Economic output is expected to increase by only 0.5 percent. “The U.S. economy may avoid a recession in 2023, but the landing will certainly not be smooth,” according to Morgan Stanley‘s latest economic forecast.
America is held by the domestic labour market
The world’s largest economy will avoid recession thanks mainly to a robust domestic labour market, although analysts expect unemployment to rise. The second positive factor will be the loosening of anti-poverty measures in China, which is expected in the coming weeks and months. This will lead to an economic recovery across the Asian region, which will also have a positive impact on the US economy.
Morgan Stanley also expects positive developments in inflation. It is set to fall radically next year. Core inflation, which is an important guide to central bank policy, is set to fall from the current 5.1 % to 2.9 %.
