Reuters
Goldman Sachs has a more positive outlook on U.S. economic growth, based on its forecast that an effective COVID-19 vaccine will “widely distribute” until the middle of next year, and has raised its projections for U.S. GDP. 6.2% by 2021. 5.6%.
“We now expect at least one vaccine to be approved until the end of 2020 and widely distributed until the end of the second quarter of 2021,” wrote the bank’s strategists, led by leading economist Jan Hatzius, in a note dated August 9.
Strategists continue to expect the unemployment rate to fall to 9% until the end of 2020, below the current 10.2%.
Goldman Sachs’ modest improvement is indicative of its assumption that “consumer spending accelerates in the first part of 2021, while consumers resume activities that would have exposed them to COVID-19 risk in the past.”
Goldman Sachs
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“We still expect a package worth at least $1.5 trillion for the law until the end of August, however, the threat of further legislative action is greater and may pose a threat to the incipient recovery,” the memo said.
Last week, the bank said markets were underestimating the possibility that at least one vaccine will develop and be in a position to be used until the end of this year. This can lead to the S-P 500 being 11% higher than what is being traded lately, Goldman said.
Front-runner vaccine candidates are expected to publish critical study results in November, according to biotech analysts at Morgan Stanley. The programs, led by AstraZenecea, Moderna, and Pfizer, have begun large clinical trials that will establish whether their proposed vaccines can prevent infection.
This month, Modern’s CEO told Business Insider that if his vaccine worked, others at higher risk of infection would prioritise in getting inoculation, while other healthy young people might be expecting to get a vaccine just next spring.
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