Goldman Sachs economists said their optimistic outlook for global growth this year is now increasingly shared by rivals, meaning their forecast is the closest to consensus than at any time since April 2020.
The Wall Street bank predicts the world economy will grow 6.6% this year and 4.8% in 2022, compared to the 6.3% and 4.8% projected by other banks, Chief Economist Jan Hatzius said in a report on Tuesday.
“Consistent with our less out-of-consensus view, the fundamental growth news has turned more mixed recently,” Hatzius wrote.
On the upside, the U.S. labor market is accelerating, business executives in Europe have turned optimistic and the global vaccination campaign has reduced fatalities from Covid-19, he said. On the negative side, Hatzius noted U.S. demand growth has slowed, labor shortages are weighing on output and the delta coronavirus variant is beginning to spread.
Goldman Sachs predicted the U.S. economy will grow 6.8% in 2021 and 4.7% next year, while the euro-area expands 5.2% and 4.5% over the same two time frames.
Hatzius said the U.S. is unlikely to overheat because its economy will slow as the reopening concludes and the fiscal support weakens. He said the Federal Reserve is unlikely to announce plans to taper its bond-buying program until December.