The International Monetary Fund (IMF) on Thursday said the U.S. economy was showing signs of strain after a series of dismal job reports and uncertainty on tariff revenue.
“What we’ve seen over the past few years is that the U.S. economy has proven to be quite resilient. We do see now that some strains are beginning to show,” IMF spokesperson Julie Kozack said during regular briefing, according to Reuters.
“Domestic demand has been moderating in the U.S., and job growth is slowing.”
Kozack said the country was on track to lower inflation rates to 2 percent but noted that fluctuating trade rates could impact the projected number.
Over the summer, Pierre-Olivier Gourinchas, IMF Economic Counsellor and Director of the Research Department, described trade conditions as “precarious,” highlighting the potential for negative supply disruptions.
“Without comprehensive agreements, the ongoing trade uncertainty could increasingly weigh on investment and activity,” Gourinchas said during the World Economic Outlook update in July.
“Further, while exports front-loading has supported global activity so far, firms could become vulnerable if the demand for stockpiled goods does not materialize,” he added.
The Trump administration is currently awaiting approval for foreign tax rates after a federal judge determined tariffs set under the International Emergency Economic Powers Act authority were unlawful.
The president is working to have the decision appealed in arguments before the Supreme Court.
As the leader awaits an answer on foreign policy constraints, his administration has raised concerns with inaccurate data from the Bureau of Labor Statistics (BLS) that has weakened the country’s economic outlook.
The U.S. economy added 911,000 fewer jobs over the 12 months ending in March than the BLS initially reported, according to newly released data.
In response to the discrepancy, the Labor Department’s internal watchdog says it is initiating a review of how the BLS compiles economic data.
On Thursday, Kozack noted mistakes should be mitigated to improve US financial standing among the world.
“This kind of data transparency strengthens the credibility of economic management in all countries,” she said.
