President Joe Biden is set to address the economy during a campaign event in Syracuse, New York on Thursday afternoon starting at 1:30 p.m. ET. The speech comes at a time when a report has shown a significant slowdown in the nation’s economy, with growth dropping to a 1.6% annual pace in the first quarter of the year due to high interest rates.
According to the Commerce Department’s report released on Thursday, the deceleration in the gross domestic product (GDP) from an impressive 3.4% growth rate in the previous quarter was largely attributed to a surge in imports and reductions in business inventories, which both had a negative impact on growth. Despite these challenges, key components of the economy remain robust, with strong contributions from both households and businesses in driving economic growth last quarter. Economist Paul Ashworth noted that there is still positive momentum in the economy, despite the volatile import and inventory figures.
However, the economy is still experiencing price pressures, which continue to be a concern for the Federal Reserve. Inflation rates increased to a 3.4% annual rate in the first quarter of the year, up from 1.8% in the previous quarter. Core inflation, excluding food and energy prices, also rose to a 3.7% rate, up from 2% in the last three months of 2023. Consumer spending, a key driver of economic activity, rose by a solid 2.5% annual rate in