USA: The International Monetary Fund projects 7% growth in 2021 after the pandemic

ROME, July 22 – In 2021, the US should grow by 7% (after -3.5% last year) and then record +4.9% in 2022, thanks to the recovery underway after the severe effects of the pandemic. This was stated by the International Monetary Fund in the periodic report on the US economy, highlighting the benefits of the vaccination campaign, with increased consumption, the resumption of services “in person” and the replenishment of stocks. The recovery – the fund continues – is backed by strong fiscal and monetary support, given that the US rescue plan – required by the Biden administration – provides for federal spending equivalent to 8.2% of GDP, interventions that were added to the fiscal package launched in December 2020 The fund commends the intention of a more equitable redistribution of resources, more investments in infrastructure and environmental interventions, as well as an emphasis on the “active” role of the Federal Reserve.

However, the Fund’s analysis notes “the need for policy adjustments to reduce the budget deficit” which last year amounted to 15.1% of GDP and this year will remain at 8%: it is also necessary to “put public debt on a gradual path.” decrease in the medium term,” hence the “recommendation to the authorities to assess the increase in revenue,” including through an emissions tax, increased fuel rates and a federal consumption tax.

On the financial stability front, “the pandemic has exposed important shortcomings in operating under pressure from US markets and institutions of systemic importance” hence the call to “assess structural changes in the performance” of markets. Moreover, during the pandemic, “the current account deficit of the United States has risen and the external situation has become weaker” than it appears.

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