Some of the headwinds that restricted first-quarter GDP growth to a paltry 0.5% annualised will fade in the second half of this year. But barring a miracle second-quarter rebound, it appears that GDP growth is on course for another underwhelming gain of around 2% this year. Unfortunately for the Fed, even that modest pace of growth has been enough to bring the economy very close to full employment and that is now coming through in terms of mounting price pressures.
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