World's largest economy US holds strong despite challenges: CEBR

Consumer spending, buoyed by employment strength, played a pivotal role in the year's economic narrative. However, as 2024 approaches, the economic landscape appears more subdued. The delayed effects of interest rate hikes and reductions in fiscal spending are expected to cool consumer expenditure and overall economic momentum, as per the CEBR report titled ‘World Economic League Table 2024’.

Inflation, which moderated to an estimated 4.1 per cent in 2023, remains a focal point. Despite a downward trend, prices are projected to stay above the Federal Reserve’s 2 per cent target into 2024, keeping policymakers and consumers watchful.

As November 2024 looms, the presidential election is set to become a critical juncture. With President Joe Biden expected to run against a prominent Republican figure, economic stewardship and domestic policies, alongside pressing foreign policy issues, are poised to dominate the discourse, the report said.

Ambitions for a greener future also continue to shape the policy landscape. The Inflation Reduction Act, with its broad sweep over climate, taxation, and healthcare, underlines a commitment to net-zero emissions by 2050, reflecting the nation's evolving policy priorities.

Long-term projections indicate a gradual decline in the United States' share of global GDP, with China expected to ascend as the world's largest economy by 2037, a year later than previously forecast. This slight adjustment reflects both an optimistic near-term outlook for the US and emerging concerns in China's real estate sector.

ALCHEMPro News Desk (KD)