In the first quarter of 2024, the US economy grew less than expected, with a GDP growth rate of just 1.6%, according to data from the Commerce Department. This is likely to be a significant issue in President Joe Biden’s re-election campaign against his Republican challenger, former President Donald Trump in November. Despite this slowdown, the US economy remains ahead of other major industrialized economies. The International Monetary Fund (IMF) predicts a 2.7% growth rate for the US for the entire year of 2024, which is an increase from last year and significantly higher than the growth rates expected for other G7 countries, such as Germany’s growth outlook of just 0.3%.
Consumer spending and exports have declined in addition to state, federal, and local spending which has contributed to the slowdown in growth. However, most currencies in the G20 group of major economies have depreciated against the US dollar this year due to various factors such as geopolitical tensions and supply chain disruptions caused by Covid-19 pandemic. While exports have decreased partly due to this depreciation, the overall economic outlook for the country remains relatively strong compared to other industrialized states.
This decline in growth is likely to be a significant issue for both political parties during their campaigns leading up to November. For President Biden’s re-election campaign, it may raise concerns about his ability to maintain economic momentum and improve living standards for Americans. On the other hand, former President Trump may use this as an opportunity to criticize his successor’s policies and argue that he would be better equipped to lead the country towards economic prosperity again if given another chance in office.