Overview

• The U.S. economy grew by 2.8% in 2024, with strong consumer spending and a surge in corporate profits in the fourth quarter.
• The fourth-quarter GDP growth was revised up to 2.4%, driven by increased consumer and government spending despite a decline in business investment.
• Inflation remained above the Federal Reserve's 2% target in late 2024, complicating monetary policy as the Fed balances growth and price stability.
• President Trump's newly introduced tariffs, including a 25% tax on foreign autos, are expected to disrupt investment and increase inflationary pressures.
• Economists warn of a potential GDP contraction in the first quarter of 2025 as consumer confidence declines and trade policy uncertainty weighs on growth.