Analysts have upgraded their forecasts for the US economy this year, bolstering hopes of a soft landing and bets that the Federal Reserve will delay interest rate cuts until the summer.
Strong growth in the final quarter of 2023 and the continued resilience of the US labour market in January have meant economists polled by Bloomberg now expect gross domestic product to expand by 2 per cent this year, about twice the pace they expected at the end of 2023.
“The US economy remains very robust and the main engine of global growth,” said Gregory Daco, chief economist at EY, who has recently raised his projection for 2024 from 1.8 per cent to 2.2 per cent. “There are headwinds, but overall there are no indications of an imminent retrenchment in the private sector.”