The non-partisan budget office said its latest forecast was based on laws passed Jan.12 and did not include any executive action or stimulus proposal from US President Joe Biden.
The U.S. economy will grow 4.6% in 2021 after contracting 3.5% in 2020, fueled by a pickup in business activity and spending on coronavirus rescue, but growth will decline to less than 2% by the end of the decade, the Congressional Budget Office said Monday.
The non-partisan budget arbiter said his latest forecast was based on existing laws passed Jan.12 and did not include any executive action or proposals to revive President Joe Biden’s administration.
The Congressional Budget Office (CBO) said it expects real gross domestic product (GDP) growth in the United States to slow to 2.9% in 2022 and 2.2% in 2023. GDP The actual average will be 1.7% for the period 2026-2031, according to CBO forecasts.
The forecasts will serve as the basis for an update of the agency’s US budget projections for the period 2021-2031, which will be released later in February.
These projections provide a baseline against which to measure the budgetary costs of proposed legislation, such as Biden’s $ 1.9 trillion COVID-19 stimulus proposal.
“In the coming year, vaccination is expected to significantly reduce the number of new cases of COVID-19, the disease caused by the coronavirus. As a result, the scale of social distancing is expected to decrease, ”CBO said in its Economic Forecast report.
The report assumes that the average unemployment rate in the United States will fall to 5.7% in 2021 from 8.1% in 2020, with the number of employed people reaching pre-pandemic levels in 2024.
But he said inflation, measured by the consumer price index excluding food and energy costs, will drop from 1.6% in 2021 to 2.1% in 2022, which is above the target of nominal inflation of 2% of the Federal Reserve.