BofA CEO: Economic Growth 'Better Than People Think'

Bank of America CEO Brian Moynihan recently expressed optimism about the U.S. economy, stating that growth is "better than people think." He highlighted that consumer spending remains robust, with a notable shift from goods to services. Despite surveys indicating declining consumer confidence due to inflation concerns, Moynihan emphasized that actual spending behavior suggests economic resilience. ​

Moynihan projected a slight deceleration in gross domestic product (GDP) growth to around 2% for the year, down from recent trends closer to 3%. He attributed part of this slowdown to ongoing trade tensions and tariffs, estimating a 0.4 percentage point reduction in growth before the economy adjusts. Nevertheless, he described the 2% growth rate as "trend growth," aligning with long-term post-financial crisis objectives. ​

Supporting this outlook, Bank of America reported strong financial results. In the fourth quarter, the bank surpassed analysts' expectations with a net income of $6.67 billion on $25.35 billion in revenue. This performance was driven by increased deposits, loan growth, and robust fee income from asset management and investment banking. Moynihan cited these results as evidence of broad momentum and a positive outlook for 2025. ​

Furthermore, the bank's digital transformation efforts have contributed to its success. The number of active digital banking users increased by 5% year-over-year to 43 million, with mobile users growing by 7% to 35 million. The AI-powered virtual assistant, Erica, has engaged with clients approximately 2 million times daily, assisting with everyday financial needs. ​

In light of these developments, Moynihan advised caution regarding potential interest rate cuts by the Federal Reserve. He suggested that the Fed should "hold on to the firepower" it has built up, considering the economy's current 2% growth rate and the uncertainties posed by trade policies. ​

Overall, Moynihan's insights underscore a resilient U.S. economy, bolstered by steady consumer spending and strategic advancements in banking services.