At the half-way mark of 2023, I checked in with Goldman Sachs economist Daan Struyven for an updated economic outlook. Back in winter, Goldman economists surprised many with their bullish outlook for the U.S. economy, when many were still expecting a recession. This time around, Goldman has another surprise prediction: the risk of a second coming of inflation is higher than that of an immediate recession. With first quarter U.S. GDP growth of 2% and sales growth slightly higher than that, “if anything the economy has grown too quickly,” Struyven said. On the other hand, more inflation could make the dreaded scenario of stagflation down the road more likely, forcing further tightening.

Source: Forbes July 10, 2023 14:06 UTC