The Congressional Budget Office (CBO) forecasts a slowdown in economic growth in the country by the end of this year and in 2023 due to the tightening of monetary policy by the Federal Reserve (Fed) and the reduction of fiscal stimulus.

CBO also expects a gradual easing of inflation in the United States.

“Higher inflation will persist into 2022 due to strong demand and limited supply in the economy,” said CBO Director Philip Swagel, “Thereafter, economic growth will slow and inflationary pressures will ease.

The CBO forecasts inflation-adjusted GDP growth of 3.1 percent in the fourth quarter of this year, up from 5.5 percent a year earlier. By the end of 2023, the rate of GDP growth is expected to slow to 2.2% and to 1.5% by the end of 2024.

Inflation (CPI) is estimated by CBO to slow to an annualized rate of 4.7% in the fourth quarter, thanks to gradual improvements in supply chains as well as lower energy prices. In March and April of this year, inflation in the States exceeded 8%.

Despite the expected decline, inflation will remain well above the Fed’s 2 percent target this year, CBO said.

In 2023 and 2024, consumer price growth is expected to slow to 2.7 percent and 2.3 percent.

U.S. unemployment is forecast by the CBO to be 3.7% in the fourth quarter of this year (3.6% in April). Projections for the end of 2023 and 2024 suggest the rate will be at 3.6% and 3.8%, respectively.