Economists of Goldman Sachs Group Inc. downgraded their 2021 economic forecast for the United States due to the emergence of the COVID-19 delta variant, Bloomberg reported.

  • Economists now expect the economy to expand 5.7%, down from the 6% forecast reported in August. The revision considers the spread of the delta variant, tapering fiscal support, and shifting demand from goods to services.
  • Economist Ronnie Walker said a “harder path” is expected this year, as the delta variant is already dragging third-quarter growth, and headwinds are expected in the medium term. 
  • Goldman slightly upgraded its 2022 economic growth forecast to 4.6% from 4.5% earlier, but this still indicates a slowdown from the expected performance this year.

The lender also hiked its unemployment rate projection to 4.2% this year, up from the earlier outlook of 4.1%. GS is down 0.29%.