President-elect Joe Biden’s $1.9 trillion coronavirus relief package has gotten a big thumbs up from Goldman Sachs analysts. They raised their growth forecasts for the U.S. this year and said in a note to clients over the weekend that the economy would grow by 6.6% in 2021, which is a bit faster than the 6.4% that was previously predicted.
The stimulus plan should also help unemployment numbers fall faster Goldman says, from the current 6.7% they are at now, to 4.5% by the end of the year. That is a marked improvement over the previous 4.8% unemployment rate there were predicting earlier.
The additional $1,400 direct payment Americans will soon be receiving is also going to play a favorable role in the economies rebound according to Goldman Sachs. They said in their note it will cause a “large spike” in disposable income over the first three months of 2021.
Economist Jan Hatzius was quoted in the Goldman Sachs note to their clients. “We do not expect all of the elements of the $1.9 trillion proposal to pass,” she said, “but we have raised our expectations for state fiscal aid, education and public health spending, unemployment insurance benefits, and several smaller items,” the analysts wrote.