Goldman Sachs Predicts U.S. GDP to Shrink 5% in Second Quarter
The U.S. economy will contract sharply in late March and April as consumers and businesses slash spending, with the short downturn likely be officially deemed as being a recession, according to Goldman Sachs Group Inc.
The world’s largest economy will shrink 5% in the second quarter after zero gross domestic product growth in the first three months of the year, the firm’s economists wrote in a note Sunday. They cut their full-year forecast to 0.4% growth from 1.2% on expectations for growth of 3% and 4% in the third and fourth quarters and strong gains in early 2021.
“The uncertainty around all of these numbers is much greater than normal,” the Goldman economists wrote. Consumers and businesses will continue to cut travel, entertainment, and restaurant spending, while supply chain disruptions and tightening in financial conditions will further dent growth, they said.
Goldman’s projections followed U.S. Treasury Secretary Steven Mnuchin saying earlier Sunday that the coronavirus pandemic probably won’t tip the U.S. into recession, and came before the Federal Reserve cut rates to near zero.
https://www.bloomberg.com/news/articles/2020-03-15/goldman-sees-sharp-u-s-contraction-nber-would-label-a-recession?utm_content=economics&utm_medium=social&utm_campaign=socialflow-organic&cmpid%3D=socialflow-twitter-economics&utm_source=twitter
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told me it would grow 4% after the tax cut. I feel betrayed.
