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Goldman Sachs nudges US growth forecast higher on Biden stimulus plan

Goldman Sachs nudges US growth forecast higher on Biden stimulus plan

FILE PHOTO: U.S. President-elect Joe Biden delivers remarks as Vice President-elect Kamala Harris looks on during a televised speech on the current economic and health crises at The Queen Theatre in Wilmington, Delaware, U.S., January 14, 2021. REUTERS/Tom Brenner

REUTERS: Analysts at Goldman Sachs raised their US growth forecast for the second time this month on expectations that President-elect Joe Biden’s fiscal stimulus plan will hasten the economy’s recovery from the COVID-19 pandemic.

The bank expects economic growth of 6.6 per cent in 2021, compared with a previous forecast of 6.4per cent, according to a report published on Saturday. It also raised forecasts for how much stimulus the new administration will be able to push through in the near-term, to US$1.1 trillion from US$750 billion.

Biden outlined a US$1.9 trillion stimulus package proposal on Thursday, saying bold investment was needed to jump-start the economy and accelerate the distribution of vaccines to bring the coronavirus under control.

“Larger boosts to disposable income and government spending imply stronger growth later in the year,” the bank’s analysts wrote.

Source: Reuters

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