Economy Watch | United States

Economy Watch: US View (January 2024)

January 15, 2024

While the prospects for a ‘soft landing’ are rising, The Conference Board believes it is more probable that the US economy will slip into a short and shallow recession in 2024. Consumer spending held up well in 2023, but headwinds associated with high interest rates, rising debt, and falling savings are concerning. Trends in income growth will be important. The US labor market remains on solid footing, but there are some signs of cooling. We do not expect a large deterioration in the labor market. On inflation, good progress is being made, but the path to 2% will be bumpy. We believe the Fed Funds Rate has peaked, but don’t foresee any cuts until mid-2024.