Recent economic data suggests positive but slower growth this year, primarily driven by consumer spending. Despite consumer resilience, declining savings, increasing credit card debt, higher delinquencies, and a moderating labor market pose potential headwinds to future economic growth. While inflationary trends are subsiding, core levels remain above the Fed’s target. Given the cumulative effects of restrictive monetary policy and tighter financial conditions, we anticipate that the economy will gradually soften and that the Fed will loosen monetary policy in 2024.