The United States started the year with a slight contraction of GDP relative to the previous quarter, due to stagnant consumption levels and a contraction of exports. GDP, however, is significantly higher than in the same quarter of the previous year, when COVID was still holding back economic activity. Since then, consumption levels have spiked and international trade has risen again. Government spending decreased, as the country is cutting back its expansionary fiscal policy. The economic recovery, production bottlenecks of Chinese manufacturing firms that were forced to stop during the pandemic, soaring energy prices, and uncertainties related to the Russian invasion of Ukraine, have contributed to increasing inflation rates, at 2.28 percent relative to the previous quarter and at 7.97 percent relative to the previous year. The OECD economic outlook excepts annual inflation to steadily decrease and to reach 3 percent by the end of year, decreasing to 2.5 percent in 2023. GDP is expected to grow at an annual rate of about than 5 percent until the end of 2023, while unemployment is expected to decrease to 3.3 percent.

July 2022