Vaccines and Government Stimulus Spur Growth.
The U.S. economy is set to expand this year on the heels of a 3.5 per cent
decline in 2020. Next year, a solid gain is anticipated. One of the main factors driving the rebound is the
massive $1.9-trillion stimulus package recently implemented by the Biden administration. The stimulus provides
funds for individual families, state and local governments, health care, and the delivery of vaccinations, among
other things. Also, the rollout of vaccinations, which is ahead of schedule, has allowed a gradual reopening of
the economy and led to higher confidence and household spending. The solid growth should close the output gap (the
difference between potential and actual real GDP) sometime in the second half of this year.
Contents of the Spring 2021 edition:
- Consumer holds the key
- What will consumers do with all their savings?
- Mixed outlook for investment spending
- Deficits as far as the eye can see
- Labour markets improving but far from normal
- Link between money supply growth and economy is changing
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