The Congressional Budget Office said Friday it expects inflation to nearly hit the Federal Reserve's 2% target rate in 2024, as overall growth is expected to slow and unemployment is expected to rise into 2025, according to updated economic projections for the next two years.
The office's Current View of the Economy from 2023 to 2025 report estimates that the unemployment rate will hit 4.4% in the fourth quarter of 2024 and remain close to that level through 2025.
Meanwhile, gross domestic product, otherwise known as the overall health of the economy, is estimated to fall from 2.5% in 2023 to 1.5% in 2024 — then rebound to 2.2% in 2025, according to the CBO projections.
Compared with its February 2023 projections, CBO’s Friday report predicts weaker growth, lower unemployment, and higher interest rates in 2024 and 2025.
But in a reminder that the U.S. economy has seldom behaved as anticipated through the pandemic and its aftermath, the employment forecast looks very different from the pace of hiring so far this year.
The jobless rate has now remained below 4% for nearly two years, the longest such streak since the late 1960s.
And on the inflation front, most economists expect growth to slow and inflation to continue to decline.
This week, the Federal Reserve kept its key interest rate unchanged for a third straight time, and its officials signaled that they are edging closer to cutting rates as early as next summer.
At a news conference, Federal Reserve Chair Jerome Powell said that officials are likely done raising rates because of how steadily inflation has cooled.
In keeping with the agency’s mandate to provide objective, impartial analysis, the report makes no policy recommendations, CBO director Phillip Swagel said in the report.
Associated Press reporter Chris Rugaber contributed to this report.
Nestlé has dismissed its CEO Laurent Freixe after an investigation into an undisclosed relationship with a direct subordinate. The company announced on Monday that the dismissal was effective immediately. An investigation found that Freixe violated Nestlé’s code of conduct. He had been CEO for a year. Philipp Navratil, a longtime Nestlé executive, will replace him. Chairman Paul Bulcke stated that the decision was necessary to uphold the company’s values and governance. Navratil began his career with Nestlé in 2001 and has held various roles, including CEO of Nestlé's Nespresso division since 2024.
Kraft Heinz is splitting into two companies a decade after they joined in a massive merger that created one of the biggest food companies on the planet. One of the companies will include brands such as Heinz, Philadelphia cream cheese and Kraft Mac & Cheese. The other will include brands like Oscar Mayer, Kraft Singles and Lunchables. When the company formed in 2015 it wanted to capitalize on its massive scale, but shifting tastes complicated those plans, with households seeking to introduce healthier options at the table. Kraft Heinz's net revenue has fallen every year since 2020.
About 780,000 pressure washers sold at retailers like Home Depot are being recalled across the U.S. and Canada, due to a projectile hazard that has resulted in fractures and other injuries among some consumers.
