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Title page

Contents

Overview 5

Recent Economic Developments 8

Projections of Gross Domestic Product and Its Components 9

Projections of the Labor Market 14

Projections of Inflation and Interest Rates 18

Projections of Income 20

Uncertainty About the Economic Outlook 21

Comparison With CBO's June 2024 Economic Projections 26

Comparison With Other Economic Projections 29

About This Document 35

Table 1. CBO's Economic Projections for Calendar Years 2025 to 2035 7

Table 2. Projected Growth of Real GDP and Its Components 10

Table 3. Key Inputs in CBO's Projections of Real Potential GDP 15

Table 4. CBO's Current and Previous Economic Projections for Calendar Years 2024 to 2034 26

Figure 1. Growth of Real GDP 6

Figure 2. Growth of Real Residential Investment 12

Figure 3. Average Annual Growth of Real Potential GDP and Its Components 16

Figure 4. Employment, Unemployment, and Wage Growth 17

Figure 5. Labor Force Participation 18

Figure 6. Inflation 19

Figure 7. Interest Rates 21

Figure 8. Uncertainty of CBO's Projections of the Growth of Real GDP 24

Figure 9. Uncertainty of CBO's Projections of Output, Unemployment, Inflation, and Interest Rates 25

Figure 10. Comparison of CBO's Economic Forecasts With Those of the Blue Chip Forecasters 30

Figure 11. Comparison of CBO's Economic Forecasts With Those in the Survey of Professional Forecasters 31

Figure 12. Comparison of CBO's Inflation Forecasts With Those in the Survey of Professional Forecasters 32

Figure 13. Comparison of CBO's Economic Forecasts With Those of the Federal Reserve 33

초록보기

In this report, the Congressional Budget Office provides additional details about the economic forecast that it published, along with the agency’s baseline budget projections, in The Budget and Economic Outlook: 2025 to 2035 earlier this year. By statutory requirement, CBO produces annual reports outlining the agency’s projections of what the federal budget and the economy would look like in the current fiscal year and over the next 10 years if current laws governing federal taxes and spending generally remained in place throughout the projection period. The agency’s current economic projections reflect laws enacted and policy measures taken through December 4, 2024.

In CBO’s economic projections for the 2025–2035 projection period:

1. Economic growth cools in calendar years 2025 and 2026 and then averages roughly 1.8 percent a year from 2027 to 2035;

2. Inflation continues to ease over the next two years, reaching the Federal Reserve’s target rate of 2 percent by 2027 and stabilizing thereafter; and

3. In response to falling inflation, slower job growth, and a rising unemployment rate, the Federal Reserve continues to lower the federal funds rate in 2025 and 2026 and then keeps that rate roughly flat over the remainder of the projection period.