STRAtEGIC CONSULTING
We believe that US economic growth will buckle early next year, leading to a short recession. This outlook is associated with numerous factors, such as elevated inflation, high interest rates, dissipating pandemic savings, rising consumer debt, lower government spending, and the resumption of mandatory student loan repayments. We forecast that real GDP will grow by 2.2 percent in 2023, and then fall to 0.8 percent in 2024, with year-over-year inflation readings to remain at about 3 percent at the end of 2023 and that the Fed’s 2 percent target will not be achieved until the end of 2024. The Fed probably has one more 25 basis point interest rate increase factor in as consumer spending slows in the first three quarters of 2024, with consumption expanding in Q4 as inflation and interest rates abate. The Florida labor market is especially challenging for a multitude of factors, which will lead to increased costs for employers.
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