UCLA Economists Predict a Weak U.S. Economy in 2024, But No Recession

For three consecutive quarters, the UCLA Anderson Forecast presented two potential scenarios for the U.S. and California economies. One anticipated aggressive inflation-fighting action by the Federal Reserve that would push the economy into a mild, near-term recession. The other allowed for less impact from the Fed’s interest rate increases that would result in a slowing economy and no recession. While many economists held fast to a recession prediction, the Anderson Forecast viewed it as a 50-50 proposition.

In its latest quarterly report, the UCLA Anderson Forecast foresees a weak U.S. economy in 2024, followed by a return to trend growth rates — albeit below trend GDP levels — in 2025. But no recession.

In California, the forecast narrative remains much the same. Throughout 2023, the state’s economy stood at a fork in the road, similar to the the nation, and the possibility of a short-term recession loomed. But California’s economy keeps chugging along —  and growing faster than the nation’s economy — thanks in part to consumers who want to spend and stimulative fiscal policy. As with the national forecast, the current forecast for California sees no recession in the near term.