U.S. Economic Outlook, November 2021: Working Through It

Shortages have challenged the recovery throughout this year, in a number of ways. Difficulties in supply chains and a slow return to work have persisted, while the costs of energy and housing are on the rise. These conditions are not expected to be permanent, but they are difficult to live through.

Economic growth lost some momentum in the third quarter, but indicators of employment and consumer activity suggest the year will end on a strong note. Holiday spending will provide a boost; not only does consumer demand remain strong, but more families will return to in-person contact after deferring celebrations last year.

It is too soon to say the economy has returned to normal. COVID-19 remains a threat, fiscal policy has become less supportive, and inflation is out of range. But a year of up-and-down recovery should conclude with a few months of cheer.

Key Economic Indicators