United States economic projection

Banco Base published an analysis on the United States economic projection, after announcing that the U.S. GDP grew during the second quarter of 2023 at an annualized quarterly rate of 2.4% and at an annual rate of 2.6 percent.

Therefore, GDP growth for the first half of the year is 2.18% annualized (compared to the same period in 2022) and shows an expansion of 6.18% from pre-pandemic levels.

During the second quarter, the U.S. economy grew 2.4% quarter-over-quarter annualized, showing an acceleration from the first quarter of the year.

Consumption was the largest contributor to second quarter GDP growth in the United States.

Internally, it highlights that consumers are prioritizing their spending on services, trying to make up for what they lost in the pandemic.

But the banking problem continues: the Federal Reserve used 105.56 billion dollars in emergency loans to banks as of July 19, 97.51% explained by the term liquidity program and, as a second aspect, credit granting decreased by 51.69 billion dollars or 0.43% between March 15 and July 12.

Economic projection

Banco Base indicated that the probability of recession for the next 12 months reached a year high of 94.7% in May, before declining to 78.8% in July.

The Fed staff no longer expects a recession this year.

At the same time, the debt ceiling was eliminated until 2025. With this, the U.S. debt stands at $32.592 trillion as of July 20, showing an increase of $1.128 trillion or 3.58% over the close of May.

Meanwhile, the fiscal deficit in the nine months of the fiscal year showed a growth of 170.4%, being the highest growth since the same period in 2020, when the deficit grew 267.3% in the face of pandemic support measures.

Thus, the fiscal deficit through June stands at $1.393 trillion or 8.49% of U.S. GDP.

One last piece of information on the economic projection: inflation has decelerated for 12 consecutive months and is expected to close this year at 3% annually.