While 2021 has seen Strong Economic Comeback, 2022 Forecast looking less Optimistic
This past year the U.S. has experienced the fastest economic growth since the times of Ronald Reagan’s presidency, bouncing back with resilience from the 2020’s devastating coronavirus recession. The nation’s gross output of goods and services had the strongest calendar year growth since 1984, after a previous recession.
This year's forecast is not as optimistic, reflecting the impact of inflation and the omicron variant. the International Monetary Fund has predicted a slow gross domestic product growth in 2022.
Many U.S. businesses, especially restaurants, bars, hotels, and entertainment venues remain strapped from the omicron variant, which has kept millions of people home. Consumer spending, which is the primary factor in economic growth, may be further hampered this year due to the cut in government aid to households, which nurtured activity in 2020 and 2021.
In addition, the Federal Reserve made it clear Wednesday that it plans to raise interest rates to battle soaring inflation. Those rate increases will make borrowing more expensive and perhaps slow the economy this year.