Biden’s Broken Economy: Goldman Downgrades U.S. Growth Forecast, Sees ‘Harder Path’ Ahead

The far-left New York Times has just launched a merciless campaign to kick His Fraudulency Joe Biden out of office.
Doug Mills/New York Times

Goldman Sachs economists once again downgraded their forecast for economic growth in the United States, writing that the economy faced a “harder path” than previously thought.

The Wall Street firm now expects the economy to expand 5.7 percent this year, economist Ronnie Walker wrote in a report Monday.

Back in August, Goldman lowered its growth estimate from 6.4 percent to 6 percent. That followed a downgrade from 6.6 percent in July. Back in February, Goldman had growth at 6.9 percent.

In mid-August, the bank slashed its third-quarter forecast from 8.9 percent to 5.5 percent, citing supply chain issues and the resurgence of coronavirus as drags on the economy.

But Walker thinks some of the growth will be pushed back in time rather than lost altogether, so the bank raised its 2022 forecast to 4.6 percent from 4.5 percent.

“There are now signs that the Delta wave is cresting,” Walker wrote. “We therefore expect a job market rebound in coming months and have also offset part of the Q3/Q4 GDP downgrade with stronger numbers in the first half of 2022.”

Some economists think that consumers will make purchases next year of things they could not find this year due to shortages and supply chain hangups.

Walker argues that consumer spending will be lower than anticipated due to fading fiscal support and ongoing supply-chain disruptions.  The handoff from spending on goods to spending on services as a driver of economic growth has been hindered by the Delta variant, according to Walker. As a result, services spending is growing more slowly than previously anticipated.

“The hurdle for strong consumption growth going forward appears much higher: the Delta variant is already weighing on Q3 growth, and fading fiscal stimulus and a slower service-sector recovery will both be headwinds in the medium term,” Walker wrote.

.

Please let us know if you're having issues with commenting.