Today, we are facing another growth scare. Just like the last time, we see good reasons why these fears
#1 – The virus/economy equation continues to evolve
transmissible Delta variant is leading to a renewed rise in cases, particularly among unvaccinated
populations. Encouragingly, while case counts are rising, all indications are that existing vaccines are
still highly effective in preventing severe illness and, more importantly, hospitalisations.
Hence, for economies with relatively high vaccination rates, like the US, UK and euro area, we don’t
expect hospital system capacity to be overwhelmed and thus see a low probability of strict lockdowns
returning. For economies which are lagging in their vaccination efforts, for instance parts of Asia, the
risk is that variants will delay a full relaxation of restrictions. While the recovery in external demand
and capex is advancing for these economies, we see domestic consumption being held back over the next 3-4
months. However, vaccinations are expected to pick up, which would give policy-makers greater flexibility
to reopen their economies, setting the stage for a broad-based recovery to take hold late this year.
#2 – US: Withdrawal of policy support is not as premature as you think
progress and economies move towards a self-sustaining path, it is only natural for policy-makers to start
thinking about exit strategies. However, we believe that neither fiscal nor monetary policy support will
be removed at a faster pace than warranted. The US economy is already on a strong footing. Wage
incomes stand at 105% of pre-COVID-19 levels, real investment is already 4% higher and GDP has reached
its pre-COVID-19 path.
While the fiscal impulse is turning negative this year, its impact on
growth has been overstated. That’s because fiscal measures have largely taken the form of transfers to
households. In fact, the excess transfers are still sitting on household balance sheets, waiting to be
spent. US households have accumulated US$2.3 trillion in excess saving, and our strong US GDP growth
forecasts of 7.1%Y for 2021 and 4.9%Y for 2022 don’t assume that this stock will have to be drawn down.
Alle Rechte vorbehalten. Nutzung ausschließlich für den privaten Eigenbedarf.
Eine Weiterverwendung und Reproduktion über den persönlichen Gebrauch hinaus ist nicht gestattet.
Kursdaten: Powered by Interactive Data Managed Solutions (IDMS). IDMS und die Datenlieferanten übernehmen keine Gewähr für die Richtigkeit, Vollständigkeit und Aktualität der Inhalte des Informationssystems. Die Kursdaten werden je nach Vereinbarung mit den Börsen/Handelsplätzen in Realtime, 15 Min. verzögert oder End-of-Day dargestellt. Weitere Hinweise entnehmen Sie bitte unseren AGB (§4 Abs.7).