Fed maintains dovish stance despite upgrading 2021 US growth to 6.5%

Fastest economic expansion since 1984 expected

Anna Fedorova
clock • 2 min read

Federal Reserve officials took a dovish stance in March’s FOMC meeting yesterday, signalling that interest rates are likely to remain unchanged until 2024, despite a significant upgrade to US growth forecasts.

The Fed increased its US growth expectations for the year to 6.5% from the 4.2% forecast in December, which would mark the fastest economic expansion since 1984, on the back of fiscal stimulus and an accelerating vaccine rollout. However, over the next two years, real GDP growth is expected to drop to 3.3% and then 2.2%, respectively. Officials also expect unemployment to drop from 6% to 3.5% by 2023, while core personal consumption expenditure inflation is expected to rise beyond the 2% target to 2.2% this year, before dropping back down to 2% in 2022 and 2.1% in 2023. Despite thi...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Economics / Markets

Why the lead-up to the Budget may have been worse than the Budget itself

Why the lead-up to the Budget may have been worse than the Budget itself

What Rachel Reeves and Dr Evil have in common

Laith Khalaf
clock 13 November 2024 • 4 min read
Bank of England meets expectations with 25 basis point rate cut to 4.75%

Bank of England meets expectations with 25 basis point rate cut to 4.75%

'Continued progress' on disinflation

Valeria Martinez
clock 07 November 2024 • 2 min read
'Budget will be a reset for our economy' Reeves tells IMF colleagues

'Budget will be a reset for our economy' Reeves tells IMF colleagues

Autumn Budget on 30 October

Linus Uhlig
clock 24 October 2024 • 2 min read