Fed Chairman Jerome Powell said that the Fed may begin to reduce monthly debt purchases this year, but it will not rush to start raising interest rates thereafter. Powell said in a pre-prepared video speech on Friday that the inflation rate has made “substantial further progress” toward the Fed’s goal, which is what he and other Fed officials have called the preconditions for reducing debt purchases. In addition, Powell said that the labor market has also made "significant progress." At the Fed's most recent monetary policy meeting, Powell said, "Like most participants, I also think that if the economy develops roughly as expected, it may be an adaptive move to start a cut within this year."

Federal Reserve Governor Christopher Waller said that reducing the Fed’s $120 billion monthly asset purchase plan would require "significant further progress" in the economy, while raising interest rates would require "almost double goals." "I think the restoration of 85% of employment is a major progress; but it is not enough to support interest rate hikes," Waller said in an interview with Yahoo Finance.

The Biden administration revised its budget forecasts for the next ten years. Because of the better economic outlook, its deficit forecast is more optimistic than it was three months ago. According to data released on Friday, the White House currently forecasts an economic growth rate of 7.1% this year and 5.2% in May. The average annual growth rate for the next ten years is expected to be 2.2%, compared with the previous forecast of 2%. This mid-term assessment prepared for Congress includes actual and expected changes in federal government revenues and expenditures.

The slowdown in the growth of personal spending in the United States in July reflects the weakening impact of commodity spending, while the closely watched inflation indicator is still at a relatively high level. Data released by the US Department of Commerce on Friday showed that spending on goods and services increased by 0.3%, after revised data in June by 1.1%. The personal consumption expenditure (PCE) price index rose 0.4% month-on-month and 4.2% year-on-year.

As concerns about inflation and the epidemic continued, US consumer confidence remained weak at the end of August. Data released on Friday showed that the final value of the University of Michigan Consumer Confidence Index fell from 81.2 last month to a low of 70.3 in the past ten years, consistent with the initial value. Investigation director Richard Curtin said in a statement that “the extreme consumer response was due to the delta epidemic, rising inflation, slower wage growth, and a smaller decline in the unemployment rate.” If the decline in confidence translates into a decline in spending, then the next few Monthly economic growth may decelerate further.

The US merchandise trade deficit narrowed to its lowest level in three months in July, and imports fell from record highs. Data released by the US Department of Commerce on Friday showed that the trade deficit narrowed to 86.4 billion U.S. dollars, which was revised to 92.1 billion U.S. dollars in June. Imports fell 1.4% to 233.9 billion US dollars, mainly due to the decline in consumer goods imports. The only category that saw a sequential increase was automobiles. With the inoculation of the vaccine, the American people were able to carry out activities that could not be carried out in the early stage of the epidemic, thus shifting the focus of spending to the service industry and reducing spending on consumer goods.

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