With selected research partners, we explore the future of risk coverage, assess changes in the risk landscape and act as a catalyst for industry change.
US Economic Outlook – Split government and third wave of COVID-19 likely to curb growth in 2021
Article information and share options
This article was written
By
Jerome Jean Haegeli, Group Chief Economist
&
Thomas Holzheu, Chief Economist Americas, Swiss Re Institute
&
Fernando Casanova Aizpun, Senior Economist, Swiss Re Institute
&
Mayank Raturi, former Senior Economist, Swiss Re Institute
Without the blue wave that pollsters had anticipated in the US elections, the prospects of a large (USD >1 trn) fiscal stimulus are diminished and we therefore see the results as a headwind for economic growth in 2021. The COVID-19 outbreak is now on its third wave and likely to trigger a new set of mobility restrictions, both formal and behavioral. Weighing these downside risks and accounting for a stronger bounce back than expected in Q3, we increase our real GDP growth forecast from -4.6% to -4.1% for 2020, and decrease from 3.8% to 3.5% for 2021.
Key takeaways
Political power remains fragmented, a > USD 1.5 trn new fiscal stimulus seems to be off the table now.
The COVID-19 outbreak reached new highs in October, opening the prospects for more mobility restrictions.
We revise our '20 and '21 growth forecast to -4.1% and 3.5%, from - 4.6% and 3.8% respectively.
Economic Outlook
US Economic Outlook - Split government and third wave of COVID-19 likely to curb growth in 2021
Contact
sigma research
Our data driven research publications, including the industry leading sigma, enable risk focussed decision making and identify strategic opportunities in the re/insurance industry.
