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12 Mar 2013
Forex Flash: US outlook in a nutshell - Nomura
Nomura economists have taken a look at the US economy and have presented a nutshell summary of the key points they see looking forward,
They begin by emphasising that fiscal policy remains a source of uncertainty for the outlook, but risks of a policy misstep have diminished. Further, they are expecting capital expenditures to accelerate in the second half of the year in response to lower uncertainty around the outlook. Elsewhere, they feel that there is ample economic slack, which is apparent in the high unemployment rate and unused capacity, which should restrain inflation.
They write, “We expect the FOMC to continue its long-term asset purchases through the third quarter of 2013, and taper purchases thereafter. (Further), a strengthening of the housing market should support investment, job creation, and aggregate demand. The slowing pace of global growth and contractionary US fiscal policy are the key risks to growth.”
They begin by emphasising that fiscal policy remains a source of uncertainty for the outlook, but risks of a policy misstep have diminished. Further, they are expecting capital expenditures to accelerate in the second half of the year in response to lower uncertainty around the outlook. Elsewhere, they feel that there is ample economic slack, which is apparent in the high unemployment rate and unused capacity, which should restrain inflation.
They write, “We expect the FOMC to continue its long-term asset purchases through the third quarter of 2013, and taper purchases thereafter. (Further), a strengthening of the housing market should support investment, job creation, and aggregate demand. The slowing pace of global growth and contractionary US fiscal policy are the key risks to growth.”