U.S. Real GDP Growth Slows to 1.4 Percent in First Quarter of 2024
The U.S. economy experienced a significant slowdown in growth during the first quarter of 2024, according to the latest data released by the Commerce Department’s Bureau of Economic Analysis. The real Gross Domestic Product (GDP) grew by 1.4 percent on an annualized basis, which is lower than the 3.4 percent growth seen in the fourth quarter of 2023.
The report attributed the deceleration in GDP growth to various factors, including a slowdown in consumer spending, exports, and government spending. However, there was a slight uptick in residential fixed investment.
The Federal Reserve, in response to the economic data, kept interest rates steady at its recent policy meeting but predicted a potential rate cut later in the year. This decision was influenced by the cooling inflation rates and signs of strain in the banking system.
Desmond Lachman, a senior fellow at the American Enterprise Institute, believes that the conditions are ripe for the Fed to start cutting interest rates. However, he suggests that the Fed may wait until after the presidential election in November to make any significant moves.
Overall, the latest economic data paints a picture of a slowing U.S. economy, prompting speculation about potential actions by the Federal Reserve to prevent a recession.
