## IMF Executive Board Concludes Article IV Consultation with the United States _IMF News, June 24, 2019_ ## Source details **Canonical URL:** [IMF Executive Board Concludes Article IV Consultation with the United States](https://www.imf.org/en/news/articles/2019/06/24/pr19234-united-states-imf-executive-board-concludes-article-iv-consultation) ## Other formats - [Markdown version](/en/news/articles/2019/06/24/pr19234-united-states-imf-executive-board-concludes-article-iv-consultation/index.md) - [Structured JSON version](/en/news/articles/2019/06/24/pr19234-united-states-imf-executive-board-concludes-article-iv-consultation/index.json) - [Bundle manifest](/en/news/articles/2019/06/24/pr19234-united-states-imf-executive-board-concludes-article-iv-consultation/bundle-manifest.json) ## Bibliographic details - Published: June 24, 2019 --- ### Overview - Date: June 24, 2019 - The U.S. economy is described as in the longest expansion in recorded history, with unemployment at levels not seen since the late 1960s. - Economic activity is growing above potential, aided by a fiscal stimulus and supportive financial conditions. - Real wages are rising, including for those at the lower end of the income distribution, and productivity growth appears to be recovering. - Inflationary pressures remain remarkably subdued. - Distributional and social concerns: average life expectancy is falling; income and wealth polarization have increased; poverty has fallen but remains higher than in other advanced economies; social mobility has steadily eroded. - Medium-term risks highlighted: elevated vulnerabilities in leveraged corporates and potentially in the nonbank system; risks from an abrupt reversal of supportive financial market conditions; risks from deepening trade disputes; U.S. public debt-to-GDP ratio on an unsustainable path expected to continue rising throughout the medium-term as aging-related spending rises. ### Executive Board Assessment - Executive Directors welcomed continued robust performance and noted low unemployment, rising real wages, and subdued inflation. - Economic prospects viewed as favorable with risks broadly balanced, but concerns include: - Public debt on an unsustainable path. - Continuing trade tensions and uncertainties. - Rising medium-term risks to financial stability. - Policy guidance emphasized: - Continued vigilance, prudent macroeconomic policies, and supply-side reforms to secure strong, balanced, and inclusive growth and positive spillovers. - Address external imbalances through fiscal adjustment and supply-side reforms to enhance productivity and competitiveness. - Work constructively and cooperatively with trading partners to address distortions and resolve trade tensions to promote a more open, stable, and transparent rules-based international trade system. - Ensure benefits of the strong economy are broadly shared; address rising income inequality and improve social outcomes. - Encourage reforms in education, healthcare, and social programs, specifically recommending: - Expanding the Earned Income Tax Credit. - Providing family-friendly benefits. - Improving healthcare coverage while tempering costs. - Policy adjustments to lower the fiscal deficit and put public debt on a gradual downward path over the medium term, including: - Consider options to better control entitlement spending. - Raise indirect taxes. - Create fiscal space to expand investments in infrastructure and human capital. - Improve the budgetary process. - Monetary policy: welcomed the Federal Reserve’s pause in interest rate adjustments and recommended deferring further increases in the federal funds rate until clearer signs of wage or price inflation; appreciated data-dependent approach and forward-looking communication; welcomed readiness to consider refinements following the Fed’s review. - Financial sector: noted well-capitalized banks but building risks among leveraged corporations and possibly nonbanks; emphasized enhancing risk-based regulation and supervision, strengthening oversight of nonbanks, and addressing data gaps. - Governance: welcomed voluntary participation in the Fund’s enhanced governance framework on supply and facilitation of corruption and encouraged improving entity transparency and beneficial ownership information. ### Selected Economic Indicators (Percentage change from previous period, unless otherwise indicated) - Projections and historical figures presented for 2018–2024. Key entries include: - Real GDP: 2.9 (2018); 2.6 (2019); 1.9 (2020); 1.8 (2021); 1.7 (2022); 1.6 (2023); (2024 value not listed) - Real GDP (q4/q4): 3.0 (2018); 2.3 (2019) - Net exports 1/: -0.2 (2018); 0.2 (2019); 0.0 (2020) - Total domestic demand: 2.4 (2018); 2.0 (2019); 1.5 (2020) - Final domestic demand: 2.2 (2018); 2.1 (2019) - Private final consumption: 1.2 (2018); 0.6 (2019) - Public consumption expenditure: 1.0 (2018); 1.1 (2019); 0.8 (2020); 0.7 (2021) - Gross fixed domestic investment: 4.8 (2018); 2.7 (2019) - Private fixed investment: 5.2 (2018); 3.1 (2019) - Public fixed investment: -0.1 (2018); 0.1 (2019) - Change in private inventories 1/: (values not listed) - Nominal GDP: 4.3 (2018); 4.0 (2019); 3.8 (2020); 3.7 (2021); 3.6 (2022) - Personal saving rate (% of disposable income): 6.8 (2018); 6.5 (2019); 6.4 (2020); 6.3 (2021); 6.2 (2022) - Private investment rate (% of GDP): 17.8 (2018); 18.1 (2019); 18.2 (2020); 18.3 (2021) - Unemployment rate: 3.9 (2018); 3.5 (2019) - Labor force participation rate: 62.9 (2018); 63.0 (2019); 62.7 (2020); 62.5 (2021); 62.3 (2022); 62.1 (2023) - Potential GDP: (value not listed) - Output gap (% of potential GDP): 1.4 (year not specified) - CPI inflation (q4/q4): 2.5 (year not specified) - Core CPI Inflation (q4/q4): (value not listed) - PCE Inflation (q4/q4): (value not listed) - Core PCE Inflation (q4/q4): (value not listed) - GDP deflator: (value not listed) - Federal balance (% of GDP) 2/: -3.9 (2018); -4.2 (2019); -4.0 (2020); -4.3 (2021); -4.1 (2022); -3.8 (2023) - Federal debt held by the public (% of GDP): 77.8 (2018); 78.7 (2019); 79.6 (2020); 80.6 (2021); 82.0 (2022); 83.3 (2023); 84.2 (2024) - General government budget balance (% of GDP) 2/: -5.3 (2018); -4.9 (2019); -4.6 (2020); -4.5 (2021) - General government gross debt (% of GDP): 106.8 (2018); 107.9 (2019); 108.8 (2020); 109.9 (2021); 111.3 (2022); 112.4 (2023); 113.2 (2024) - Interest rates (percent; period average) — Fed funds rate: 2.8 (period not specified) - Three-month Treasury bill rate: 3.2 (period not specified) - Ten-year government bond rate: (value not listed) - Current account balance (% of GDP): -2.3 (2018); -2.1 (2019); -2.5 (2020); -2.7 (2021); -2.6 (2022); -2.4 (2023) - Merchandise trade balance (% of GDP): (value not listed) - Export volume (NIPA basis, goods): 4.7 (period not specified); 4.4 (subsequent period not specified) - Import volume (NIPA basis, goods): 4.1 (period not specified) - Net international investment position (% of GDP): -47.4 (2018); -47.5 (2019); -48.2 (2020); -49.1 (2021); -50.0 (2022); -50.7 (2023); -51.4 (2024) - Gross national saving (% of GDP): 19.0 (2018); 19.3 (2019); 18.7 (2020); 18.8 (2021); 18.9 (2022) - General government saving: -3.2 (period not specified); -2.2 (period not specified) - Private saving (% of GDP): 22.2 (2018); 22.0 (2019); 21.3 (2020); 21.2 (2021); 21.5 (2022) - Personal saving: 5.1 (period not specified); 4.9 (subsequent period not specified) - Business saving: 17.1 (period not specified); 16.4 (subsequent period not specified); 16.7 (subsequent period not specified); 16.5 (subsequent period not specified) - Gross domestic investment (% of GDP): 21.1 (2018); 21.4 (2019) - Public investment: 3.3 (period not specified) - Sources for indicators: BEA; BLS; FRB; Haver Analytics; and IMF staff estimates. - Notes: - 1/ Contribution to real GDP growth, percentage points. - 2/ Includes staff's adjustments for one-off items, including costs of financial sector support. *IMF Communications Department, June 24, 2019.* --- ## References - [https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg) - [The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx) - [United States and the IMF](http://www.imf.org/external/country/USA/index.htm) - [IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance) - [Press Releases](https://www.imf.org/en/news/searchnews) - [PRESS CENTER](http://presscenter.imf.org/) - [http://www.imf.org/external/np/sec/misc/qualifiers.htm](http://www.imf.org/external/np/sec/misc/qualifiers.htm) - [https://www.imf.org/en/home](https://www.imf.org/en/home) _Source: https://www.imf.org/en/news/articles/2019/06/24/pr19234-united-states-imf-executive-board-concludes-article-iv-consultation_