Goldman Sachs is out with its economic forecast for the coming year, and it may not please people hoping for a quick end to surging prices before the holiday shopping season. Highlights:
- Inflation: "The current inflation surge will get worse this winter before it gets better," says the report labeled "2022 U.S. Economic Outlook," per Axios. However, Goldman predicts inflation will "settle down" next year, "without a need for aggressive monetary policy tightening" by the Fed.
- Unemployment: The bank sees the economic recovery from the pandemic continuing and projects that US unemployment will match a 50-year low of 3.5% by the end of next year, reports CNN. Unemployment hit nearly 15% at its worst point in the pandemic.
- Stocks: Goldman predicts the benchmark S&P 500 index will continue rising through next year and reach 5,100 by year's end, per Yahoo Finance. That would be a 9% rise from the current mark, which Reuters notes is relatively modest compared to this year's gains of about 25%.
- Growth: The bank expects the economy "to reaccelerate to a 4%+ growth pace over the next few quarters as the service sector continues to reopen, consumers spend part of their pent-up savings, and inventory restocking gets underway."
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