WASHINGTON, June 25 - The International Monetary Fund reported that the United States economy continues to show robust growth momentum and projected that inflation would reach the Federal Reserve’s 2% target by the end of 2027. Speaking at a regular IMF news briefing, spokeswoman Julie Kozack said the Fund viewed the Fed’s recent decision to keep its key policy interest rate unchanged as appropriate.
Kozack highlighted revised data published on Thursday that moved first-quarter U.S. gross domestic product to a 2.1% annualized rate, up from the previously reported 1.6% pace. She pointed to several domestic strength indicators underpinning that revision: a rebound in government consumption, strong investment activity, and sustained high labor productivity.
"Growth momentum in the U.S. economy has been solid," Kozack told reporters, noting that those factors make the United States somewhat of an outlier globally in the Fund’s assessment.
Although inflation remains above the Fed’s 2% objective, the IMF expects inflationary pressures to moderate over time. Kozack said this outlook was a central consideration behind the Fed’s recent pause on policy tightening.
"Because of this dynamic, we think the Fed appropriately decided to keep the policy rate on hold. Any further policy actions by the Fed will need to proceed with caution and they would need to be carefully calibrated to the incoming data," she added, emphasizing the Fund’s view that future moves should be data dependent.
Contextual notes
- The IMF’s commentary reflects its interpretation of released U.S. data and its projection for inflationary convergence to the Fed’s target by the end of 2027.
- The Fund specifically welcomed the strong commitment of the new Fed chair, Kevin Warsh, to delivering price stability.