USA (Transatlantic Today) – Economic activity in the United States recorded an annual growth rate of 1.6% in the first quarter of 2024, a slowdown from the 3.4% recorded in the previous quarter of 2023, according to the Bureau of Economic Analysis. According to economists surveyed by Bloomberg, this growth figure fell short of market expectations, which had anticipated an increase of 2.5%. The slowdown in US international spending, which includes Colombia, is evident.
In the first quarter of 2024, interest rates remained stable at historically high levels and private household consumption in the US weakened. However, the labor market remained robust, adding 303,000 jobs in March, exceeding the average of 231,000 new jobs over the past twelve months.
Factors to contributor growth
In the individual economic sectors, fixed investments in residential buildings (+13.9 %), fixed investments in non-residential buildings (+2.9 %) and state and local government spending (+2 %) were the main contributors to the positive growth in the first quarter of 2024. Meanwhile, consumer spending, measured in terms of the consumer spending indicator, saw a 2.3% annual growth, a modest increase compared to the 3.3% registered at the end of Q4 2023.
Risks and monetary policy
According to Amchamcolombia, despite the resilience of the US economy to monetary tightening, there are fears of a possible economic slowdown in the coming months, mainly due to the prospect of persistently high-interest rates. This concern stems from the gradual decline in inflation towards the Federal Reserve’s long-term target of 2%.
At its most recent monetary policy meeting, the Federal Open Market Committee stated that it is seriously monitoring inflation. The Committee released the following statement: “The Committee does not believe it is appropriate to reduce the target range until there is greater confidence that inflation is moving toward the 2% objective on a sustained basis.”
At the local level, Colombian investors in the US may continue to benefit from favorable financing and investment circumstances thanks to the Federal Reserve’s monetary policies.
