CBO: Inflation Will Hinder US Economy Into 2023

National Review: Inflation will decrease slightly but likely continue into 2023, the Congressional Budget Office said in a report released on Wednesday on the outlook of the economy and federal budget for the next ten years. The consumer price index will hit 4.7 percent in the fourth quarter of 2022 compared with the same period in 2021, the CBO projected. Inflation will continue to decrease to 2.7 percent by the fourth quarter of 2023. Inflation would thus remain higher than levels recorded prior to the Covid pandemic… The CBO report also projected that U.S. GDP will grow by 3.1 percent in the fourth quarter of 2022 compared with the same period the previous year, slower than the 5.5 percent pace recorded in the fourth quarter of 2021. GDP growth will likely slow to 2.2 percent in 2023 (National Review). 

CBO: CBO projects that the federal budget deficit will shrink to $1.0 trillion in 2022 (it was $2.8 trillion last year) and that the annual shortfall would average $1.6 trillion from 2023 to 2032. The deficit continues to decrease as a percentage of gross domestic product (GDP) next year as spending related to the coronavirus pandemic wanes, but then deficits increase, reaching 6.1 percent of GDP in 2032 (CBO).