New York (CNN Business)The US economic recovery will slow more

New York (CNN Business)The US economic recovery will slow more than feared during the final three months of the year because Congress is almost certainly will not provide more federal aid, Goldman Sachs said Thursday. The Wall Street bank slashed its fourth-quarter US gross domestic product growth forecast in half to just 3% on an annualized basis because of the deadlock in Washington. That would mark an extreme deceleration from the rapid growth economists are predicting for the third quarter, when Goldman expects US GDP to grow at an annualized pace of 35%. "At this point we think it is clear that Congress will not pass additional fiscal stimulus this month," Goldman Sachs economists wrote in a note to clients. "We now think any further stimulus will wait until early 2021 New York (CNN Business)The US economic recovery will slow more than feared during the final three months of the year because Congress is almost certainly will not provide more federal aid, Goldman Sachs said Thursday. The Wall Street bank slashed its fourth-quarter US gross domestic product growth forecast in half to just 3% on an annualized basis because of the deadlock in Washington. That would mark an extreme deceleration from the rapid growth economists are predicting for the third quarter, when Goldman expects US GDP to grow at an annualized pace of 35%. "At this point we think it is clear that Congress will not pass additional fiscal stimulus this month," Goldman Sachs economists wrote in a note to clients. "We now think any further stimulus will wait until early 2021." That's a big deal because the economy has been screaming out for more help from Uncle Sam. For example, another 870,000 Americans filed for first-time unemployment benefits last week, a level that's four times higher than before the pandemic. "It's crazy that we could be adding more than 800,000 new people to the unemployment rolls and we're not talking about finding relief or rescue for these people," Austan Goolsbee, a former economic adviser to President Obama, told CNN's Poppy Harlow on Thursday Like many on Wall Street, Goldman Sachs had been assuming another $1 trillion of stimulus was coming to boost the recovery. However, lawmakers have been unable to reach a deal on the size and composition of a recovery package. And that was even before the death of Supreme Court Justice Ruth Bader Ginsburg set off a huge scramble in Washington over her replacement. Failure to get a stimulus deal will cause a "meaningful hit" to disposable income in the fourth quarter, causing it to drop to pre-pandemic levels, Goldman Sachs said. That in turn will pressure consumer spending.


https://www.stp.forex