Wells Fargo's latest US economic outlook indicates that US growth is still resilient. Real GDP is expected to grow by 3.0% annualized in the third quarter, mainly supported by consumption and corporate investment. Retail sales increased 1.2% month-on-month in August, and the bank expects actual consumption to grow by about 3.2% annualized in the third quarter. However, strong imports may drag down net exports by nearly 2 percentage points of GDP. In terms of monetary policy, the bank expects the Federal Reserve to raise interest rates again during the year, raising interest rates to 4.00%-4.25%, and remain unchanged in 2027. Since excess inflation is mainly driven by supply factors and the job market is not overheated, there are limited reasons for more aggressive austerity.

Wells Fargo's latest US economic outlook indicates that US growth is still resilient. Real GDP is expected to grow by 3.0% annualized in the third quarter, mainly supported by consumption and corporate investment. Retail sales increased 1.2% month-on-month in August, and the bank expects actual consumption to grow by about 3.2% annualized in the third quarter. However, strong imports may drag down net exports by nearly 2 percentage points of GDP. In terms of monetary policy, the bank expects the Federal Reserve to raise interest rates again during the year, raising interest rates to 4.00%-4.25%, and remain unchanged in 2027. Since excess inflation is mainly driven by supply factors and the job market is not overheated, there are limited reasons for more aggressive austerity.