Goldman Economists Turn Even More Bullish on U.S. Growth, Hiring

Goldman Sachs Group Inc. extended its already bullish forecasts for the U.S. economy by predicting unemployment will fall to 4% by the end of this year.

In a report ahead of this week’s meeting of Federal Reserve policy makers, the Goldman economists led by Jan Hatzius predicted the U.S. economy would grow 8% in the fourth quarter of this year compared with the same period in 2020.

They said unemployment would fall from 6.2% in February to 3.5% next year and 3.2% in 2023, while inflation would remain limited with the Fed’s favored measure growing just 2.1% in 2023.

Still, the economists predicted Fed Chair Jerome Powell and colleagues won’t indicate a readiness to pull back on monetary stimulus until the end of this year and the tightening won’t actually begin until the fourth quarter or early 2021. That would leave interest-rate hikes off the table until mid-2023, they said.

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