Date Published: March 18, 2021
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As we did last quarter, this quarter’s economic update is in Q&A format. We have posed (and answered) the questions that we deem most relevant to the economic outlook, starting with vaccine rollouts and fiscal stimulus. From there we delve into the outlook for consumer spending, commodity prices and inflation and the impact these could have on financial markets. This is followed by a discussion of the disparate impact of the COVID-19 shock on the labour market and the key risks to watch out for over the next year.
|Key elements||Amount ($, bn)|
|Direct payments of $1400/person*||410|
|State and local government aid||350|
|Unemployment benefits ($300/week to Sept.)||289|
|Transportation, infrastructure, financial services, other education and labor||268|
|Assistance for Small Businesses, Pensions, Expanded health benefits for workers and premium tax credits||217|
|Expanded Child Tax Credit, Earned Income Tax Credit and various others||159|
|Re-open K-12 Schools||129|
|Testing, tracing & vaccines||122|
|Major Downside Risks||Major Upside Risks|
|Third wave of infections, vaccine inefficacy, slower rollouts||Better news on vaccine manufacturing and effectiveness|
|Social unrest due to inequality||More widespread distribution to emerging markets|
|Premature withdrawal of policy support||More fiscal support than currently envisaged|
|U.S. Economic Outlook|
|Interest Rate Outlook|
|Foreign Exchange Outlook|
|Commodity Price Outlook|
|Global Economic Outlook|
|Economic Indicators: G7 and Europe|
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