A new estimate for U.S. economic growth released Thursday could mean that higher interest rates, and resulting economic pain, will be with Americans for longer.
Gross Domestic Product, a measure of economic growth, for the U.S. remained at 2.1% for the second quarter of 2023 in its third revision, after being revised down from an original estimate of 2.4%, while GDP for the first quarter was revised up from 2.0% to 2.2%, according to the Bureau of Economic Analysis.
Jerome Powell, chair of the Federal Reserve, noted at the Jackson Hole Economic Symposium in August that factors like high inflation, a hot labor market and sustained economic growth could mean higher rates for longer.
The last rate hike in July was the 11th increase to the federal funds rate since March 2022, leaving the range at the highest level since 2001.
Following the FOMC meeting, Powell noted that an economic "Soft landing," a slowdown of market growth while avoiding triggering a recession, was not a "Baseline expectation," meaning the interest rates that were meant to slow down the economy to fight inflation could trigger a recession.
Inflation continues to remain high, further incentivizing the Fed to keep rates elevated, rising to 3.7% for August, far above the Fed's 2% target.
The focal point of Bidenomics is high-spending programs like the Inflation Reduction Act, which some experts argue have contributed to inflation, ultimately leading to rate increases.
https://dailycaller.com/2023/09/28/bidens-growth-numbers-signal-more-pain/
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