The nation’s Gross Domestic Product is expected to see a 2% increase during the first quarter of this year, according to a new forecast issued by the Congressional Budget Office.
That figure represents an improvement over the 1.9 % rate recorded in the final quarter of last year and should remain at that level heading into late summer.
In its Current View of the Economy from 2025 to 2027, the CBO additionally notes that higher tax rates upon the expiration of the 2017 Tax Cut and Jobs Act later this year will contribute to a “slowdown in consumer spending.”
The report also sees a decline in inflation from last year’s 2.5% to 2.2% this year, with a slow downward slope in interest rates from a “4.6% in the fourth quarter of 2024 to 3.4% at the end of 2027.”
The nation’s unemployment rate, which reached an unprecedented high of 14.8% during the Covid 19 spring of 2020, fell to 4.2% as of the end of last year. The CBO report sees a slight jobless increase to 4.4% this year, a figure that is expected to remain constant well into 2027.
Such figures, notes the publication Forbes, suggests a mostly positive 2025 economy. Consumer spending is up, while “most everyone who wants a job has one, and wages are now rising faster than inflation.”
Putting all the trends together, Mark Zandi, chief economist with Moody’s Analytics, told the New York Times: “President Trump is inheriting an economy that is about as good as it ever gets.”
Zandi added that the U.S. economy is the only large economy globally that is currently “growing more quickly post-pandemic than pre-pandemic.”
January 7, 2025
By Garry Boulard
