In the first quarter of 2024, the US GDP grew by 1.6%, according to the US Bureau of Economic Analysis. However, this growth fell short of initial estimates. With interest rates and inflation remaining high, the GDP print raises questions about the strength of the US economy.
As the Federal Reserve works to lower inflation rates, Claudia Sahm, founder of Sahm Consulting, explains how GDP figures factor into current economic outlooks. Sahm notes that while imports and inventories had an impact on the GDP growth, they are not significant enough to change the overall view of the economy.
Sahm emphasizes that data is key for the Fed in making its decisions moving forward. She believes that with a strong underlying pace of economic growth, there is favorable conditions for the Fed to rely on data-driven decision-making as it navigates its policy goals. As Chair Jerome Powell leads the Fed into this uncertain economic landscape, it will be crucial to consider all available information before making any definitive moves. For more expert insights and market analysis, viewers can tune in to Morning Brief for a full episode featuring Sahm Consulting’s founder.