Trump Policies Lead the US, Global Economies in Surprise Recoveries
The global economy found its post-crisis footing in Y 2017, with most major developing economies surprising on the Northside.
Comparing Y 2017 predictions made a year ago Vs the likely up-turn based on the latest forecasts in Bloomberg’s monthly survey, shows that the Pessimists called this 1 wrong.
President Donald Trump has maintained 3% growth in Quarters 2 and 3 of Y 2017. With his tax bill and growth projected up to 4%, add to that his infrastructure spending and jobs growth, we see the US wiping away the past 8 years of the Hussein Obama era’s anti-Business, anti-America no growth economic stagnation polices. Not a surprise.
One of the biggest surprises was the Euroarea, set for its strongest expansion in a decade. At 2.3%, the expected growth is far above the 1.4% pace predicted at the start of the year.
“It took a decade but the crisis is now behind us,” said the chief economist at Lombard Odier in Geneva, CH. “The global economy has found a ‘normal’ footing, inflation is starting to come back into the picture — although far from posing a risk, and central banks are able to gradually remove exceptionally supportive policies.”
Some central banks have already started down the path of exiting from stimulus, though very gradually. While the Fed is forecasting 3 interest-rate increases in Y 2018 after 3 this year, the Bank of England only lifted its benchmark rate for the 1st time in a decade in November.
In the Euroarea, the European Central Bank (ECB) is slowing, not stopping its pace of monthly bond purchases.
The Big Q: So what does Y 2018 have to offer?
The Big A: Goldman Sachs, says the main risks to the outlook are political, including the struggling NAFTA negotiations, NKorea’s nuclear ambitions and elections in Italy. But continued loose monetary conditions will support the expansion. And the Trump Tax reform will drive the US economy into a sustained 3.5-4.0% growth annually for the future.
America First leads the world back from stagnation to sustained growth.