The US economy is experiencing low GDP growth and an improved inflation outlook, according to a recent analysis by Bruce Yandle from GroundBreak Carolinas [e005c8cd]. The Federal Reserve's preferred inflation metric, the Personal Consumption Expenditure Index, grew at 2.6% in May, the lowest rate since 2021. This decline in inflation reflects the Fed's efforts to bring down inflation through higher interest rates. However, the White House and Congress have been increasing inflation by printing money to fund programs. Despite these challenges, forecaster estimates suggest a slow economy with no prospects for a recession in 2024-25. Interest rates on a 30-year fixed-rate mortgage have risen to 7.0% in May 2024, resulting in a decline in housing starts [e005c8cd].
On a positive note, the two Carolinas have the highest employment growth rates east of the Mississippi and were among the top five destination states for U-Haul customers in 2023. The market-driven economy in the Carolinas has adjusted well, with strengthened employment growth, wages catching up with inflation, and record levels of new business formations. The construction industry in the Carolinas is seeing productivity improvement driven by the accelerated use of drones and artificial intelligence in construction projects [e005c8cd].
Overall, while the US economy is facing challenges such as low GDP growth and increased inflation, the Carolinas are experiencing positive employment growth and productivity improvements in the construction industry [e005c8cd].