Elected President Joe Biden
Photographer: Mark Makela / Getty Images
Photographer: Mark Makela / Getty Images
Goldman Sachs Group Inc. economists have raised their growth forecasts for the U.S. this year and beyond after President-elect Joe Biden unveiled a comprehensive $ 1.9 billion revival plan.
In a weekend report to clients, economists led by Jan Hatzius predicted that the economy would expand 6.6% this year, faster than the 6.4% previously expected. The unemployment rate for the end of 2021 is now seen at 4.5%, down from the previous estimate of 4.8%.
The upgrade is fueled by the expectation that Biden, assisted by a Democratic Congress, will provide generous sums to state fiscal aid, education and public health spending, as well as unemployment insurance benefits, to inflict damage caused by a pandemic now looming. worst is stage to date. Goldman’s estimate for economic growth in 2021 is the second highest in a Bloomberg survey among 84 economists; the average estimate is 4.1%.
Although economists do not expect all parts of Biden’s proposal to succeed, they predict that an additional $ 1,400 in individual stimulus payments will cause a “huge increase” in disposable income in the first three months. Goldman on Thursday released its estimate for the amount of Stimulus Biden will win up to $ 1.1 trillion, up from a previous estimate of $ 750 billion.
“We now forecast that nominal disposable income will grow by + 4.5% in 2021” compared to the previous estimate of 3.8%, according to Goldman’s latest note.
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Goldman expects gross domestic product to grow by 4.3% in 2022 and 1.6% next year. “We have not made any change in our Fed forecast, and we still expect the decline to start only in 2022 and that the lifting will take place in the second half of 2024,” the economists said, referring to their previous forecast on when the Federal Reserve will raise interest rates.
Brian Deese, former director of Biden’s National Economic Council, warned on Sunday that the US economy was “spiraling downwards” and asked for prompt action.