Some more today on the US economic recovery, which is the leading indicator for the world as the vaccine glut approaches in H2. Goldman sees:
The post-vaccine reopening of the economy is barely underway, but our expectation of accelerating sequential growth is transitioning from forecast to fact. Credit card data are consistent with a mid-single-digit gain in March retail sales (control, mom sa), and we believe the risks are skewed to the upside, because the final two weeks of the month are benefitting from $240 billion of stimulus payments the week of March 17. All in, we estimate the pace of corona crisis fiscal support to consumers is accelerating by $1 trillion on an annualized basis (or 5% of GDP) for March and Q2, relative to the previous six months.nThe intra-month spending pattern also indicates a stimulus- and reopening-driven spending surge. Our Recovery Tracker inflected higher over the course of March, in part due to retailer reopenings, the reversal of winter storm effects, and a decline in new Covid infections that coincided with a 15pp increase in airport usage. Restaurant activity has similarly improved, with OpenTable seatings nearing 70% of normal nationwide and back above pre-crisis in Texas.
Looking ahead, we believe the uneven recovery to date across economic sectors is actually good news for the 2021 growth outlook, as it increases the scope for outsized gains in underperforming sectors.
45% of US GDP is in services which are still down 5% year on year. They are going to roar back.
For instance, jab a man he will eat steak:
Then jump on a plane!
We remain long good value travel stocks in the US especially, and also here, where even the useless Morrison Government will eventually catch on that the vaccine is the gateway to a boom: