Goldman Sachs Trims U.S. Growth Forecasts on Slower Service Sector Recovery

Updated : Jul 26, 2021, 14:21 UTC•1min read

LONDON (Reuters) – Goldman Sachs trimmed its U.S. economic growth forecast for remainder of the year on Monday, citing a slower recovery in the services sector.

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The Wall Street bank revised both Q3 and Q4 growth 1 percentage point lower, to 8.5% and 5.0% respectively. That left the 2021 growth forecast at 6.6% on a full-year basis.

“We have long expected growth to peak in a mid-year boom fueled by vaccination and fiscal support,” Jan Hatzius said on a note to clients. “But the subsequent deceleration now looks likely to be a bit sharper because the goods-to-services rotation is likely to be less seamless.”

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(Reporting by Karin Strohecker; Editing by Dhara Ranasinghe)

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