US stimulus to push GDP above pre-covid trend by mid-2021 – Bloomberg Economics
The US covid relief package is large enough to drive the country’s gross domestic product (GDP) above the pre-coronavirus pandemic trend by mid-2021, the latest analysis published by Bloomberg Economics showed.
In response to the fiscal aid, the US GDP growth could be seen in the vicinity of 7.4% for the full year on a 4Q-over-4Q basis, the best since 1983. Still, the level settles toward the prior trend by the end of 2022, according to the study.
The House of Representatives passed the much-awaited $1.9 trillion stimulus bill, including the measure to increase the minimum wage to $15, on Saturday.
Market implications
The stimulus optimism has joined the encouraging vaccines news, fuelling the risk-recovery while downing the safe-haven US dollar across the board.
The S&P 500 futures rally 1% to regain 3,850 levels.
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
