Goldman Sachs said the increase in cases of new crown pneumonia would limit the already strong third-quarter rebound in the U.S. economy. Jan Hatzius, chief economist at Goldman Sachs, now expects U.S. GDP to grow at an annualized rate of 25 percent in the third quarter, down from an initial estimate of 33 percent, largely because of concerns that rising new crown cases in states such as Florida, Texas and Arizona will slow the pace of economic reopening.
“The sharp increase in cases of new crown virus infection in the United States has raised concerns that the recovery may soon stop,” Hatzius said in a report. Although this increase in large part reflects a higher number of tests … A broader study of the CDC’s economic reopening standards shows that in the past few weeks, there has been a significant deterioration in the number of new cases, the rate of positive virus tests, the proportion of new coronary symptoms visited, and hospital use. “
U.S. GDP fell 5 percent in the first quarter, the biggest quarterly decline since the Great Recession in the fourth quarter of 2008, as a result of the blockade that controls the spread of the epidemic.
In the past week, there have been 340,000 new confirmed cases of new coronary pneumonia in the United States, an increase of 13.4%. 3447 deaths, an increase of 2.9 per cent.
But Hatzius says he still sees reasons for optimism.
On the economic front, manufacturing and construction have quickly resumed expansion after the worst retreat since the financial crisis. The U.S. economy added another 4.8 million jobs in June and the unemployment rate fell to 11.1 percent.
On the medical front, he believes that advances in medicine and the re-establishment of new blockades in hard-hit areas could reduce the virus’s reproductive rate to less than 1, after which it could gradually disappear.
Politically, Mr. Trump’s plan to lower corporate taxes could be reversed if he fails to do so this year. But Hatzius said it would also reduce Mr. Trump’s protectionist policies. Over the past three years, Mr. Trump’s protectionist policies have shaken markets in several ways.
Hatzius still expects U.S. stocks to lag behind other major global stock indexes as the U.S. economy “underperforms in the short term, partially reversing an excessive and hasty reopening of the consumer sector”.