US Economic Update – March 2021

2021 should be a year of strong growth

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Key highlights:

  • Very strong growth expected in 2021 (6.0%) due to fiscal stimulus and an easing in COVID-19 restrictions. However, COVID-19 risks will remain until vaccinations are far more widespread.
  • Core consumer inflation has been subdued but many indicators point to it rising; we see core PCE inflation settling at around 2% or a little higher.
  • We expect no change in the fed funds rate target range through to end 2023 although by the end of this year the Fed may announce its intention to taper QE, with tapering then commencing in Q1 2022.

Find out more in NAB’s US Economic Update – March 2021