Beijing time:2021-11-16 11:55
[NTD News November 16, 2021, Beijing time]Goldman Sachs released a report this week stating that the US economy will resume its recovery from the epidemic in the coming quarters. It is expected that the unemployment rate will fall to a 50-year low by the end of next year.
Goldman Sachs said that after the slowdown this summer, the US economy will be boosted by the unblocking of the service industry, strong consumer spending and inventory replenishment.
The report pointed out that driven by the “hot demand for manpower”, the United States is expected to maximize employment by the middle of 2022. The unemployment rate is expected to fall further from the current 4.6% to 3.7%, or to 3.5% by the end of next year. When the unemployment rate drops to 3.5%, it means that the country’s unemployment situation will be equal to the 50-year low set at the end of 2019. At the beginning of 2020, the US unemployment rate also fell to 3.5%.
According to Goldman Sachs’ analysis, this will signify that the vitality of the US job market has greatly improved. Its unemployment rate has soared to 14.8% since the outbreak of the epidemic in April 2020.
However, Goldman Sachs is currently not optimistic about Americans returning to the job market. The report pointed out that “although the labor participation rate may still be lower than the pre-epidemic level, in an environment where employment opportunities are very abundant, this seems to be structural (problem) or voluntary (return to work is not high).”
The US Department of Labor announced last week that the number of resignations in the country reached 4.4 million in September, a record high.
In addition, Goldman Sachs wrote in the report that “the degree of inflation is shocking”, and the price shock “may worsen this winter, and then it will get better.”
Although Goldman Sachs expects rising wages and rents to bring “continuous inflationary pressure,” it expects that the inflation rate will only be “moderately higher” 2%, which is in line with the Fed’s new inflation target—that is, letting go for several years. The sluggish inflation rate can slightly exceed 2%.
Goldman Sachs expects that when the Federal Reserve ends its bond-purchasing plan next year, it will only raise interest rates twice a year. The report said: “We expect that both economic growth and inflation will stabilize before the end of the year, and (and the Fed may continue) do not need to actively tighten current monetary policy.”
(Reporter Chen Beichen Comprehensive Report / Chief Editor: Lin Qing)
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