Georgieva made evaluations about the country’s economy at the press conference where the leading findings of the audit within the scope of the 4th article consultation on the US economy were shared.
Stating that the US economy has proven to be resilient, Georgieva said consumer demand is well-protected, initially supported by savings and more recently by a rise in disposable income.
Georgieva stated that they expect the US economy to grow by 1.2 percent annually this year and maintain its momentum until 2024.
Pointing out that they expect unemployment to rise gradually and approach 4.5 percent by the end of 2024, Georgieva emphasized that the labor market is still quite strong.
Georgieva described the resilient demand and strong labor market as a “double-edged sword”, adding that this has helped support American families while also contributing to inflation being more persistent than expected.
Inflation expected to stay above Fed’s target through 2024
Stating that they expect core inflation to gradually decline to around 4 percent towards the end of this year, Georgieva stated that they expect inflation to remain above the Fed’s medium-term target throughout 2024.
“Getting inflation back to the 2 percent target definitively will require prolonged tight monetary policy,” Georgieva said. said.
Stating that they expect interest rates to stay between 5.25 percent and 5.5 percent until the end of 2024, Georgieva said, “Interest rates will have to be a little higher for a longer period of time.” made its assessment.
Pointing out that there is still high uncertainty about the economy and inflation dynamics, Georgieva emphasized the importance of careful communication by the Fed.