[Asia Economy Reporter Park Byung-hee] The Wall Street Journal (WSJ) reported on the 11th (local time) that according to a survey of economists, the U.S. economic growth rate this year is expected to reach 6.4%, the highest since 1983 (7.9%). The forecast for next year's economic growth rate is 3.2%, which would be the highest two-year growth rate since 2005.
In the December survey last year, economists predicted a growth rate of 3.7% for this year. However, after President Joe Biden's inauguration, two large-scale stimulus packages were passed, and a massive fiscal injection amounting to 13% of the Gross Domestic Product (GDP) was decided, leading to a significant upward revision of this year's economic growth forecast.
The International Monetary Fund (IMF) also revised its U.S. economic growth forecast upward on the 6th, projecting 6.4% for this year and 3.5% for next year. The U.S. growth rate for the fourth quarter of last year was 4.3%, while the overall growth rate for last year was -3.5% due to the impact of COVID-19.
Economists pointed to inflation as a side effect of the rapid economic growth. The Consumer Price Index (CPI) increase rate (year-over-year) for June is expected to reach 3%, the highest CPI increase rate since 2012. The U.S. CPI increase rate for February was 1.7%. The U.S. Department of Labor is scheduled to release the March CPI on the 13th.
The Personal Consumption Expenditures (PCE) price index, which the U.S. Federal Reserve (Fed) considers an important inflation indicator, is expected to rise to 2.5% in the fourth quarter of this year and remain above 2% through 2023. The PCE price index increase rate for February was 1.6%.
Economists also forecast that jobs will increase by 7.1 million this year, the highest since 1978. The expected number of jobs in the December survey last year was 4.9 million. The unemployment rate forecast for the end of this year was 5.6% in December last year but was revised to 4.8% in this survey.
WSJ conducted the survey from the 5th to the 7th of this month, targeting 69 experts from industry, academia, and finance sectors in the U.S.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
