United States Economic Growth Experienced Massive Slowdown In First Quarter of 2024

According to figures published by the Bureau of Economic Analysis (BEA) on April 25, 2024, the United States economy increased at a clip of 1.6% in 2024’s first quarter. This slowdown comes on the heels of decent growth in 2023’s third and fourth quarters, which recorded 4.9% and 3.4% growth rates, respectively, according to the BEA. Economists projected that GDP growth would hover around 2.2% in the first quarter. 

High rates of growth towards the end of 2023 have worried economic pundits about a potential “no-landing” scenario, where the economy is still humming along with an increased rate of inflation and significant increases in GDP. Prices climbed upward at a rate of 3.5% year-over-year in March. This rate grew faster than the Federal Reserve’s target range of 2%.

The Fed implemented a federal funds rate ranging from 5.25% and 5.50%, the highest range in 23 years, in an effort to temper economic growth and reduce inflation. An increase in the federal funds rate has resulted in the rising cost of credit across the economy, which has caused reductions in spending and investment across the economy.

Things won’t go back to normal economically speaking in the US anytime. As long as the American economy remains fiat in nature, economic instability will continue to be the norm. Only a downsizing of the regulatory state and an abolition of the Federal Reserve will bring back economic normalcy to the US.

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