Georgieva said the US labor market remains resilient, as does consumer demand
The head of the International Monetary Fund (IMF), Kristalina Georgieva, said yesterday, Thursday, that there is good evidence that the US can avoid recession this year and achieve a “soft landing” of its economy.
Georgieva told reporters that US labor markets remain resilient, while consumer demand remains strong, despite recent inflation-fighting interest rate hikes. As she said, there is a healthy shift away from excessive purchases of goods, which had depressed prices, while demand for services is returning and there are more diversified sources of growth in the US economy.
These developments “provide sufficient argument for an expectation that the US could avoid economic recession,” Georgieva said during her first press conference for 2023. “Indeed, I could say that in technical terms (the US) they are already in recession, but it will be a very mild recession.”
She noted that defining recessions is often the subject of heated debate, but she said she was leaning toward a soft landing scenario for the US.
The IMF in October estimated US GDP growth for 2023 at 1%, and will update this estimate this month. The World Bank estimated on Tuesday that the growth of the US economy will register at 0.5% for 2023.
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