We’re in for a ‘partial V-’ shaped economic recovery - Goldman Sachs economists

Omkar Godbole FXStreet Contributor

Economists at Goldman Sachs are forecasting a partial V-shaped recovery in the US economy, which would include a reversal of more than half the 2020 economic contraction by September, but no full recovery in GDP to pre-coronavirus levels until mid-2021, according to MarketWatch. The forecast, however, is based on the assumption that there is premature fiscal tightening or resurgence in the number of coronavirus cases.

Key quotes

The rise in the Institute for Supply Management’s manufacturing index suggests that the economy was already rebounding quickly in sequential terms in June.

A “multi-month decline in the PMIs to 45 or below” would be a warning sign of stalling momentum, they add, while a sustained period of PMIs of 55 or more would signal a true “V-shaped” recovery.

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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