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UK's Economic Rebound to Outpace US in 2021: Goldman Sachs

UK’s Economic Rebound to Outpace US in 2021: Goldman Sachs

Posted Monday, April 26, 2021 by
Aiswarya Gopan • 1 min read

Leading investment bank Goldman Sachs has turned extremely upbeat about the UK’s economic rebound from the ongoing coronavirus crisis. According to the bank, UK’s economy is set to grow at a faster pace than that of the US, supported by the rapid rollout of the COVID-19 vaccine.

It estimates that the UK GDP for 2021 would touch 7.8%, far higher than the IMF’s estimates for a 5.3% growth and Reuters’ forecast for a 5% growth this year. In comparison, the US economy is expected to grow by 6.8% this year as it emerges out of the coronavirus crisis. The higher forecast by Goldman Sachs comes on the back of reports that over 50% of UK’s population has been vaccinated against COVID-19 so far.

In its report, the investment bank notes, “The UK economy is rebounding sharply from the Covid crisis. The April flash PMI was much stronger than expected in the UK, with the services PMI moving strongly further into expansionary territory.”

The coronavirus pandemic and ensuing lockdowns drove a contraction of almost 10% in the UK economy through 2020, while the US economy likely contracted by around 3.5%. However, following the recent reopening of the economy earlier this month, the UK is expected to rebound strongly through the next few quarters and help the GDP post a strong reading this year.

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