Will the United States experience 7% growth in 2021?

New York Federal Reserve (Fed) Chairman John Williams said Monday, May 3, that this was possible.

Such growth would be the fastest pace of growth since the early 1980s.

>> To read: In a hundred days, has Joe Biden buried "American neoliberalism"?

In addition, while some fears persist about a too sharp rise in prices, and that inflation over one year has already exceeded the 2% target of the American Central Bank, he considered "important to not overreact to (the) price volatility resulting from the unique circumstances of the pandemic ".

Adjusted for inflation, GDP growth should, according to him, be around 7%.

The gross domestic product recorded in the first quarter an increase of 6.4% on an annualized basis, a measure which allows to project the annual growth if the pace is maintained.

However, this should accelerate in the second quarter.

>> To read: "The help is there and the hope arrives", affirms Joe Biden during his first press conference

In addition, while some fears persist about a too sharp rise in prices, the president of the New York branch of the Central Bank also deemed "important not to overreact to (the) price volatility resulting from the unique circumstances of the pandemic ".

"Around 8.5 million fewer jobs today"

Year-on-year inflation hit 2.3% in March, according to the PCE index, exceeding the US Central Bank's 2% target.

But for John Williams, it is better to "stay focused on the trend" of the price curve.

However, it should not continue to climb for too long as follows: "I expect that once the price reversals (which start to rise again after the drop at the start of the pandemic, Editor's note) and the Short-term imbalances due to the reopening of the economy will have occurred, inflation will return to around 2% next year, "he said.

However, he recalled that the economy still has "a long way to go before reaching a full and solid economic recovery".

>> To read: In the United States, Joe Biden wants to double the minimum wage

"Let us not forget that there are approximately 8.5 million fewer jobs today than before the pandemic", he noted.

April employment figures will be released on Friday, and a million job creations are expected.

With AFP

The summary of the week

France 24 invites you to come back to the news that marked the week

I subscribe

Take international news everywhere with you!

Download the France 24 application

google-play-badge_FR