Though 16 million new jobs were created since end-2020, income and wealth gains have been uneven across the income distribution and poverty remains high, particularly following the expiration of pandemic-era support, IMF noted after its executive board concluded the Article IV consultation with the United States recently.

The general US government fiscal deficit and debt, as a share of gross domestic product (GDP), are both projected to remain well above pre-pandemic forecasts over the medium-term, IMF said in a release.

Wealth gains and limited refinancing needs have bolstered household and corporate balance sheets against the contractionary impact of higher interest rates, the IMF noted.

Monetary policy tightening was also supported by important supply-side gains, including an expansion of labour supply from immigrant inflows.

Under current policies, the general government debt is expected to rise steadily and exceed 140 per cent of GDP by 2032, the IMF said.

IMF directors noted the ongoing intensification of trade restrictions as well as the domestic content provision in various fiscal programmes, which create a risk for both the United States and global economy.

They urged the authorities to unwind obstacles to free trade and instead bolster competitiveness through investment in workers and infrastructure.

Fibre2Fashion News Desk (DS)