COVID and Supply Chain Concerns Limit U.S. Economy Growth
The full-year 2021 real GDP growth forecast has been revised modestly downward due in part to the expectation that COVID-related disruptions to consumer spending and supply chains will more greatly hinder economic activity in the second half of the year than previously forecast, according to the August 2021 commentary from Fannie Mae’s Economic and Strategic Research (ESR) Group.
A weaker than previously anticipated second quarter real GDP reading also contributed to the downward revision to the full-year 2021 growth outlook from last month’s 7% to this month’s 6.3%. However, the downgrade was offset partially by an upgraded 2022 growth forecast from 2.8% to 3.2%. The ESR Group continues to expect inflation, as measured by the Consumer Price Index (CPI), to remain around 5% by the end of 2021, as broader inflationary pressure from wage and home price growth replaces some…
