The IMF announced today (Thursday, July 1st) that the United States economic growth is expected to be around 7 percent in 2021 and around 5 percent in 2022 in a press briefing led by the IMF’s managing director Kristalina Georgieva and the United States mission chief Nigel Chalk.
The pandemic hit the United States hard but by mid-June, over one-half of the eligible population has been fully vaccinated and both new cases and the test positivity rate have fallen markedly.
Indicators suggest significant labor market slack remains which should serve as a safety valve to dampen underlying wage and price pressures. Inflation expectations are also expected to remain well-anchored.
The unprecedented fiscal and monetary support, combined with the receding COVID-19 case numbers, should provide a substantial boost to activity in the coming months. Savings will be drawn down, demand will return for in-person services, and depleted inventories will be rebuilt.
This is the opening remarks given during the press briefing by IMF managing director Kristalina Georgieva at the United States 2021 Article IV Consultation press conference.