11.09.202523:50:05UTC+00IMF Flags Emerging Strains in U.S. Economy

The International Monetary Fund (IMF) issued a cautionary statement on Thursday, indicating that the longstanding resilience of the U.S. economy is beginning to wane. The key factors highlighted were a reduction in domestic demand and a deceleration in job growth. According to IMF representative Julie Kozack, while inflation is progressing towards the Federal Reserve's 2% target, potential risks loom due to tariffs instated during the Trump administration. Kozack pointed out that preemptive import activities before the tariff implementation significantly contributed to market volatility in early 2025, and these tariffs now pose inflationary threats. Although the IMF acknowledges the possibility for the Federal Reserve to reduce interest rates, it advocates for a careful approach, emphasizing the importance of ongoing data analysis. Additionally, Kozack brought attention to a recent revision by the U.S. government, which disclosed that 911,000 fewer jobs were created during the year ending in March than previously estimated. This discrepancy, described as "a bit larger" than usual, suggests that employment levels may have been stagnating prior to the tariff increases. The IMF plans to examine the factors contributing to this revision in their upcoming evaluation of the U.S. economy, scheduled for November.