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UK economy set to grow faster than the U.S. this year -Goldman

Published 04/25/2021, 03:14 PM
Updated 04/25/2021, 03:15 PM
© Reuters. FILE PHOTO: People shop at market stalls, with skyscrapers of the CIty of London, Britain financial district seen behind, in London

LONDON (Reuters) - Britain looks set to see faster economic growth than the United States this year as the country races ahead with its vaccination programme after its slump in 2020, Goldman Sachs (NYSE:GS) said on Sunday.

The bank said in a note to clients that it now expects British gross domestic product to grow by a "striking" 7.8% this year, "above our expectations for the U.S."

A Reuters poll of analysts published on April 13 showed an average forecast for growth of 5.0% in the UK, the world's fifth-biggest economy in 2021. The International Monetary Fund has projected a 5.3% expansion.

But since those forecasts were made there have been signs of an acceleration in the pace of recovery with the country now having given a first coronavirus vaccine to more than half of its total population.

"The UK economy is rebounding sharply from the Covid crisis," Goldman Sachs said.

"The April flash PMI was much stronger than expected in the UK, with the services PMI moving strongly further into expansionary territory," it said.

The bank also noted a much-stronger-than-expected 5.4% monthly jump in retail sales in March.

The note did not provide a comparison forecast for U.S. economic growth this year. In February, Goldman said it expected U.S. GDP would grow by 6.8% in 2021 as President Joe Biden pushed ahead with a huge fiscal stimulus programme.

Britain's economy shrank by nearly 10% last year as it was hit by longer coronavirus lockdowns than many of its peers. By comparison, the U.S. economy shrank by an estimated 3.5%, according to the IMF.

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On Saturday, Bank of England Deputy Governor Ben Broadbent was quoted as saying he expected "very rapid growth at least over the next couple of quarters" as the country lifts its coronavirus restrictions.

Latest comments

This is messed up... look at the thousand of protestor without mask, they are due to have a big spike coming and will have to go in a lockdown again...
Nonsense. The UK economy has been in tatters for over a decade.
what worries me is that by printing money we achieve a higher GDP growth, but there's no value being created. something has to give and that will be the dilution of the middle class.
And don't forget to mention HUGE inflation coming...
It's year over year right? Then it's bouncing "more" because we dropped less. luckily Trump was in office or it would have been 20%
Hahaha... they wish... lol
lol the uk gdp gets hit by brexit and us gdp already above 8% atleast according to their fake data lol
False information.
False Indications. Corrupt Goldman Sach ... Another free Fall is coming towards Europe! Wait
Free fall is coming for US and UK both, in coming weeks/months. UK made a big mistake with Brexit and now pay the price in form of huge import/export struggle and International companies moving their hq's and factories away from UK. US vice versa is in deep s..t with money printing, bonds, FED, housing, etc. GDP probably ain't gonna be 8% but lower if not fabricated numbers. Wall Street says everything just fine but ask anyone from middle class and things are just the opposite.
OK nostradamus.
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