Despite the ongoing claims that global growth is fading and the US, Japan, China and Europe are all seeing sharp decreases in GDP, the fine people at Goldman Sachs are saying that we should just relax and focus on the “bright picture” because Brexit will and US China trade can be successfully negotiated.
Goldman economists Jan Hatzius and Sven Stehn wrote in a joint piece, “we think this is a major overreaction.” The economists added that while pressure on German manufacturing was valid, easy fiscal conditions and a strong labor market pointed to better releases in the future. This piece was sourced on CNBC 25, March, David Reid.
The bearish bond move sent equities tumbling the overall message from the Goldman team was to keep calm and focus on markets. According to this piece the China growth fade is coming to an end and better economic releases will come in the March and April period. In addition to the China news which of course was positive, the view from Mr Hatzius and Mr Stehn on the US was positive.
While the number they placed in GDP in the United States for Q1 was 0.7 percent, their view for the second quarter was in the 3.0 percent range. Also the US and China, according to the report will have a trade deal on the table in the next couple of months.