The Federal Reserve projected Friday that the economy just missed the Trump administration’s 3 percent target for economic growth.
The economy likely grew at slightly less than 3 percent in 2018, the central bank estimated in a monetary policy report. The final data for the fourth quarter of 2018 was delayed by the partial government shutdown.
The Fed said that growth and the overall economic outlook remained solid. But the estimated results are less than the 3 percent target the Trump administration has aimed for every year and less than the administration expected following the 2017 tax overhaul.
“For the year, [gross domestic product] growth appears to have been a little less than 3 percent, up from the 2½ percent pace in 2017 and the 2 percent pace in the preceding two years,” the Fed reported. That’s down from previous projections of slightly over 3 percent growth.
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Last July, following the release of second quarter economic growth figures, President Trump said that economic growth above 4 percent was, “very, very sustainable. This isn’t a one-time shot.”
The Fed noted its estimate is preliminary. A formal estimate of GDP growth in 2018 from the Bureau of Economic Analysis was delayed until Feb. 28 due to the partial funding lapse.
But the central bank also said that it based its own estimate on poor retail sales data and softening in consumer and business sentiment during the last three months of 2018, data that it already has access to.
