Parallel to keeping interest rates unchanged, the Federal Reserve looks at economic growth with great optimism. It sees the US economy growing by 1% this year, much better compared to the previous estimate of 0.4%.
However, despite observing a 1.1% GDP growth, the central bank slightly lowered its forecast for the following year, expecting only a 1.8% increase, from the previous estimate of 1.9%. At the same time, it expects inflationary pressures to consistently exceed 2%, with core inflation, which excludes food and energy prices, rising by 3.9% this year. This indicator will remain elevated in 2024, climbing by 2.6%. And by 2025, it will increase by 2.2%.
Consumer prices may also rise by 3.2% this year, slightly lower than the March estimate of 3.3%. For 2024, it will grow by 2.5%, and for 2025 by 2.1%.
The Federal Reserve also anticipates greater stability in the labor market, as the unemployment rate may rise to 4.1% this year, slightly lower than the March estimate of 4.5%. The unemployment level will remain stable in both this year and 2025.
