Global Growth Perspective: US Stands Out

Not only isn’t a recession headed down the pike, but the US economy is emerging from the pandemic tunnel with stronger potential GDP than it had prior to the pandemic. Today, Eric explains why he and Dr. Ed believe that potential GDP growth is 4.0% annually, more than twice FOMC members’ latest consensus forecast for long-run real GDP of 1.8%. Why is the economy resetting at a higher level? The growing labor force and the productivity growth boom we expect—our Roaring 2020s thesis—provide tailwinds. … The global economy is also gaining steam, even though China’s economy remains moribund.