Economic Outlook for May 2024

This technical report presents the economic outlook for May 2024, detailing key developments in U.S. monetary policy and economic indicators. The Federal Open Market Committee (FOMC) has maintained the fed funds rate steady for the sixth consecutive meeting, acknowledging persistent inflation pressures. The report outlines a reduction in the quantitative tightening program, with a planned decrease in the monthly cap on Treasurys starting in June. Employment data from the Bureau of Labor Statistics indicates a slowdown in job growth, with 175,000 jobs added in April, below expectations. The unemployment rate has slightly increased to 3.9%. Additionally, the report highlights a slower-than-expected growth in real GDP, which rose by 1.6% in the first quarter, and a significant increase in the core PCE price index. The outlook suggests that tight monetary policy may continue to impact consumer spending and the labor market, with expectations for below-trend GDP growth in 2024.