White House economists predict that economic growth will not hit Donald Trump’s much invoked target of 3 per cent.
The strength of the economy is likely to be a key plank in the president’s re-election campaign.
The only way in which the 3 per cent target might be reached is if Congress enacts major legislation such as an infrastructure package, immigration reform, new trade deals, or additional tax cuts.
While growth at this level is well below what was promised by the president, it is similar to growth levels under President Obama, and is considered ideal for a healthy developed country.
The economy did come close to the president’s target in 2018 when it hit 2.9 per cent, but has since been impacted by his trade wars, which took the edge off the effects of the large tax cut and increase in federal spending.
Towards the end of his first year in office, Mr Trump told reporters he was holding out for economic growth of 6 per cent — a prediction described at the time as “wildly optimistic” based on historical data.
Despite the continuing conflict between reality and the president’s bravado, the vast majority of Americans say that this is the best economy since the late 1990s, which should help Mr Trump as he seeks re-election.