Prospects for the US economy in 2022

Subject

Prospects for the US economy in 2022.

Significance

The US economy has recovered quickly, with real GDP surpassing the level of the previous peak by the third quarter. Personal consumption spending is 8.6% above pre-pandemic levels but employment remains well below, while supply/demand imbalances will ease only gradually through 2022. Fiscal and monetary policy will be less expansionary, even if President Joe Biden’s second, USD2tn social infrastructure bill passes, and if rates stay on hold well into next year.