US Economics | Waning Economic Strength

As outlined in our recent, detailed U.S. Economics Focus publication, Veneta Demetrova is revising her 2023 real GDP growth projection up by 0.5% to a range of 0% to 1.0%. This is primarily due to growth in 1H23, driven by a resilient labor market and excess savings. She expects growth to soften in the back half of the year, however, as tightening credit conditions and weakening corporate profitability may lead to payroll cuts. The NDR U.S. Recession Watch report also reflects an elevated risk of recession starting in late 2023/early 2024, with 5 of 10 indicators on negative signals.