A downtrend in consumer spending slowed economic growth in the second quarter compared to the previous one, but the economy is holding steady, according to the Bureau of Economic Analysis (BEA).
, and strong household savings supported consumer spending longer than expected, boosting the macroeconomy.
"Our current prediction for a mild downturn in the first half of 2024 is predicated on the belief that consumers will begin pausing their spending, in part due to the exhaustion of those funds and having to realign to a more sustainable relationship between spending and incomes," said Doug Duncan, Fannie Mae senior vice president and chief economist.
The next GDP report for the third quarter will be published at the end of October. The Conference Board said in a that economic growth will likely "buckle under mounting headwinds early next year, leading to a very short and shallow recession." "This outlook is associated with numerous factors, including, elevated inflation, high interest rates, dissipating pandemic savings, mounting consumer debt, lower government spending, and the resumption of mandatory student loan repayments," The Conference Board said. "We forecast that real GDP will grow by 2.2% in 2023 and then fall to 0.8% in 2024."
If you're worried about your high-interest debt in a troubling economy, you could consider paying it off with a personal loan at a lower interest rate.
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