US economy 'to operate at low speed in first half of 2024'

The US economy showed signs of decline in the first half of 2024. (Source: AP)

Specifically, personal spending - the main driver of the economy - fell 0.5 percentage point to 1.5% in the first quarter of this year. The decline was also evident in orders and shipments of some business equipment, while the trade deficit was the largest in two years, the job market was weak and home purchases declined.

Bill Adams, chief economist at Comerica Bank, said the world's largest economy is "operating at a low pace in the first half of 2024," although personal spending recovered somewhat in May.

The country’s goods trade deficit widened to $100.6 billion in May, the largest in two years, as exports fell, government data showed, while figures also showed a rise in inventories held by wholesalers and retailers.

Signs of financial stress, modest labor demand, rising jobless claims and challenges from a stronger dollar are likely to continue to hamper US economic growth in the second half of the year, the report said.