Below are the key highlights from the International Monetary Fund’s recently published staff report for the United States.
- Unemployment is low, inflation is well contained, and growth is set to accelerate.
- During the course of this administration, the economy is expected to enter the longest expansion in recorded U.S. history.
- The combination of revenue losses from the Tax Cuts and Jobs Act and the approved increase in spending will create a significant increase in the fiscal deficit in the next few years.
- Given the planned fiscal stimulus, the Federal Reserve will need to raise policy rates at a faster pace to achieve its dual mandate.
- In executing its monetary policy decisions, the Fed’s continued adherence to the principles of data dependence and clear communication will be vital.
- The U.S should work constructively with its trading partners to reduce trade barriers and to resolve trade and investment disagreements without resorting to the imposition of tariff and non-tariff barriers.
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