Keep pulling the thread on Global Economic Prospects.
Karen Dynan forecasts that United States economic growth will slow from 2.1% to 1.9% over the forecast period, which she considers a more sustainable pace.
Karen Dynan forecasts China's economic growth will slow to the mid-4% range and then to 4.3% next year due to the ongoing property crisis.
Approximately 25% of the world's oil supply transits through the Strait of Hormuz.
Brent crude prices remain approximately 30% higher than they were before the recent Middle East conflict.
European natural gas prices are approximately 50% higher than they were before the recent Middle East conflict.
In an alternative scenario where Brent crude prices reach $150 per barrel by mid-year, global economic growth would be reduced by four-tenths of a percentage point.
Net immigration to the United States has fallen from 3-4 million people annually in 2022-2023 to an estimated zero in 2025.
AI-related investment is the primary driver of US business fixed investment growth in 2025, offsetting negative growth in other categories.
Karen Dynan's baseline forecast is that the Federal Reserve will hold interest rates steady for most of the year and implement another rate cut at the end of the year.
In 2025, non-farm payroll growth in the United States averaged 10,000 per month, the lowest level this century outside of recessions.
According to Census Bureau estimates, net international migration to the US is expected to drop from a peak of 2.7 million in the year ending July 1, 2024, to 321,000 in the year ending July 1, 2026.
The current US hiring rate is at a level that, pre-pandemic, was typically only seen when the unemployment rate was in the 8% to 9% range.