Positive signs in 2024’s second quarter GDP report: CEI analysis

The nation’s GDP grew 2.8 percent during the second quarter of 2024. Strong growth indicates rapidly improving living standards and an easier fight against remaining inflation. CEI senior economist Ryan Young provides his analysis of the report:

“Over the last century, average GDP growth has been right around 2 percent. In that context, last quarter’s 2.8 percent GDP growth is excellent news. In the short run, it means more people’s living standards are improving more rapidly than usual. 

“This is especially so because most of the faster growth is coming from private sources such as consumer spending and inventory investment, rather than public sector boondoggles.

“Strong growth also makes conquering the last mile of inflation easier, which is good news for the long run. Strong growth makes another round of inflation-causing stimulus less likely. It also means the Federal Reserve can delay its planned interest rate cut without fear of disrupting the economy.

“There are some concerns about job growth slowing, but part of that is because the economy is near full employment and has been for more than two years. When that’s the case, job growth must slow down at some point, even as the unemployment rate stays historically low.”