Hardwood Floors February/March 2024

INDUSTRY INSIGHTS

MARKET MATTERS

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A SLOWDOWN WITHOUT RECESSION 20 hardwood floors hardwoodfloorsmag.com

The U.S. economy is moving in two opposite directions at the same time as it continues to drain its prior strength. Low unemployment, declining overall inflation, a strong U.S. dollar, and continued but slowing consumer spending are buoying economic growth. Pushing against this growth are high food, energy, and household-related costs, significant and growing federal deficits, a weak housing market with high interest rates, and wars in Ukraine and the Middle East. All of this leads us to the conclusion that the U.S. is heading for an economic slowdown, which will bottom mid-2024 before rising slowly through 2025, returning to trend growth (+2.0 percent) in 2026, all without any recession. Since flooring is more a discretionary item, its fortunes will fare slightly worse than the overall economy.