We expect the US economy will experience a soft landing in 2024 as its lows in response to the Federal Reserve’s aggressive tightening, the labour market slows and the contribution from fiscal policy wanes. 

We forecast that GDP will rise by an average of 1.1% next year, down from an estimated 2.4% in 2023. We cannot rule out a period of mildly negative growth at some stage, but that is consistent with a soft landing. 

We do not expect next year’s presidential election will have a material impact on growth or policy settings. The Fed is independent and will continue to set policy as it sees fit. We expect rate cuts to start in Q3.