Mon Sep 30 17:20:46 UTC 2024: ## US Economy Shows Signs of Slowdown as Inflation Cools and Job Growth Wanes

**Washington, D.C. -** The US economy is showing signs of slowing down as inflation continues to cool and job growth weakens. The consumer price index (CPI) inflation fell below 3% in July for the first time in over a year and is projected to reach 2.7% by the end of 2023.

Meanwhile, job growth is expected to slow further, with Deloitte attributing this partly to demographic changes that are decreasing the labor force participation rate. The US unemployment rate has already risen to its highest level since October 2021.

With inflation on the decline and unemployment rising, the Federal Reserve is expected to begin cutting interest rates in September. Deloitte predicts two cuts of 100 basis points each this year and next.

Despite these positive signs, there are also concerns about the future. Deloitte has outlined a second scenario where persistent inflation and geopolitical conflicts could significantly slow the economy, with US GDP growth reaching just 1% in 2025. This scenario also foresees increased tariffs that could push inflation above 3% until the third quarter of 2025.

However, there are some encouraging signs. Personal consumption expenditure (PCE) grew by 2.9% in the second quarter, with increased spending on durable goods suggesting rising consumer confidence.

While exports have slowed in the first half of the year, government spending is predicted to rise by 2.9% in 2023.

Despite these mixed signals, the overall picture suggests that the US economy is entering a period of transition, with inflation cooling but growth slowing. The Federal Reserve’s actions will play a crucial role in shaping the future trajectory of the economy.

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