A COVID-19 resurgence over the winter and persistent inflation may slow growth as the US enters 2022

The Conference Board forecasts that the US economy will grow by 5.0 percent (annual rate) in Q4 2021 and 5.5 percent for the full year. However, a resurgence in COVID-19 infections over the winter will dampen economic growth in early 2022. Persistently high inflation and improvements in the labor market should lead to tighter monetary policy by mid-2022, raising borrowing costs across the economy. Even so, the deployment of federal infrastructure spending should moderate the impact. We expect the US economy to grow by 3.5 percent next year.