Current:Home > ScamsExpect higher unemployment and lower inflation in 2024, says Congressional Budget Office -Summit Capital Strategies
Expect higher unemployment and lower inflation in 2024, says Congressional Budget Office
View
Date:2025-04-13 06:33:13
The Congressional Budget Office expects a softer labor market to help lower inflation in 2024.
The 2023 labor market has been strong but gradually cooling, with a November unemployment rate of 3.7%, according to the Labor Department’s latest jobs report. The CBO expects unemployment to jump to 4.4% in the fourth quarter of 2024 and remain close to that level through 2025.
A softening labor market and slower rent increases would help the Fed nearly hit its 2% inflation target, according to the report. Inflation measured by the core personal consumption expenditures (PCE) price index is expected to slow over the next two years, falling from an estimated 2.9% in 2023 to 2.1% in 2024 before jumping back up to 2.2% in 2025.
What is inflation?Why prices rise, what the rate means, and who it hurts the most.
The report comes shortly after the Federal Reserve hinted that it could be done hiking interest rates and forecasted three cuts next year amid falling inflation and a cooling economy.
Protect your assets: Best high-yield savings accounts of 2023
The latest CBO report also projects real gross domestic product growth to fall from 2.5% in 2023 to 1.5% in 2024 as consumer spending weakens. It is then expected to rebound to 2.2% in 2025 under improved financial conditions and lower interest rates.
But predicting the economy’s future is no easy task. The CBO says its projections are “highly uncertain, and many factors could lead to different outcomes.” Some of its predictions have already changed since its February report, which forecasted an unemployment rate of 5.1% by the end of this year compared with the current 3.7%.
“Compared with its February 2023 projections, CBO’s current projections exhibit weaker growth, lower unemployment, and higher interest rates in 2024 and 2025,” the report reads.
veryGood! (4)
Related
- Could your smelly farts help science?
- Human remains found by Miami beachgoer are believed to be from unborn baby, police say
- Missing U.S. military helicopter found in Southern California; search on for 5 Marines who were on board
- Daughter of Wisconsin inmate who died in solitary files federal lawsuit against prison officials
- The Super Bowl could end in a 'three
- Royal insider on King Charles' cancer diagnosis and what it means for Britain's royal family
- Taylor Swift fans in Tokyo share why she means so much to them
- Wisconsin governor doubts Republican Legislature will approve his maps
- Why Sean "Diddy" Combs Is Being Given a Laptop in Jail Amid Witness Intimidation Fears
- The Senate eyes new plan on Ukraine, Israel aid after collapse of border package
Ranking
- Taylor Swift makes surprise visit to Kansas City children’s hospital
- How Grammys Execs Used a Golf Cart to Rescue Mariah Carey From Traffic
- A 94-year-old was lying in the cold for hours: How his newspaper delivery saved his life
- Innovative Products That Will Make You Feel Like You're Living In The Future
- Rams vs. 49ers highlights: LA wins rainy defensive struggle in key divisional game
- Police who ticketed an attorney for shouting at an officer are going to trial
- Military helicopter missing with 5 US Marines on board after leaving Nevada
- Books from Mexico, Netherlands, and Japan bring rewrites of history, teen tales
Recommendation
Residents worried after ceiling cracks appear following reroofing works at Jalan Tenaga HDB blocks
Wendy's is giving away free cheeseburgers this week. Here's how you can get one.
Human remains found by Miami beachgoer are believed to be from unborn baby, police say
Philadelphia lawyer accused of falsely claiming to represent family of boy killed by police
Which apps offer encrypted messaging? How to switch and what to know after feds’ warning
A sniper killed a Florida bank robber as he held a knife to a hostage’s throat
Satellite images show scale of Chile deadly wildfires, destroyed neighborhoods
'Lisa Frankenstein' review: Goth girl meets cute corpse in Diablo Cody's horror rom-com