The Real Economy: September 2024

7 reasons why the U.S. economy will not fall into recession

After two years of aggressively raising interest rates and then keeping them elevated, the Federal Reserve is poised to begin cutting rates. These lower rates will spur businesses to invest in equipment, software and intellectual property, as well as prompt consumers to refinance their mortgages.

In the September issue of The Real Economy, RSM Chief Economist Joseph Brusuelas looks at the market forces driving the Fed’s coming policy pivot and explains why the economy is not about to tip into a recession.

Among Brusuelas’s forecasts:

  • The economy will grow at a 1.8% rate in the second half of the year.
  • Hiring will slow to near 120,000 per month in the final months of the year.
  • The Fed will cut its policy rate until it reaches somewhere between 3% and 3.5%.
As much as critics can argue about the timing of Federal Reserve policy choices, the normalization of interest rates in the U.S. and Europe has reintroduced risk into the securities market, forming the basis for prudent investment going forward.
Joe Brusuelas, Chief Economist

Also in this issue, Brusuelas looks at inflation expectations, as seen in Treasury inflation-protected securities. In August, the 10-year TIPS were projecting an inflation rate of 2.1%, which is just about at the Fed’s target of 2%. It all adds up to a new rates regime for the Federal Reserve.

We look at these topics and more in this issue of The Real Economy.

Inside the September

RSM contributors

The Real Economy Livestream series

Key economic themes affecting the middle market

Join RSM US Chief Economist Joe Brusuelas and U.S. Chamber of Commerce Executive Vice President Neil Bradley as they discuss the economic outlook and what middle market companies should anticipate.

Recorded September 18, 2024

Subscribe to RSM's economic insights

Timely economic analysis and trends to help middle market businesses succeed

Special report

Middle market is confident about AI, despite early-stage adoption changes

  • 78% of respondents say their organization either formally or informally uses AI
  • 41% report being in the partial implementation phase for AI
  • 58% of those who use generative AI want to use it to improve quality control

Also from The Real Economy

Monthly economic analysis report for the US middle market

The Real Economy Blog

The Real Economy Blog was developed to provide timely economic insights about the middle market economy. It is offered as a complement to RSM’s macroeconomic thought leadership, including The Real Economy monthly publication and the proprietary RSM US Middle Market Business Index (MMBI).

The voice of the middle market

Middle market organizations, which make up the “real economy,” are too big to be small and too small to be big. They have distinct challenges and opportunities around resources, labor, technology, innovation, regulation and more.