US Executive Podcast – June 2021

​Gregory Daco, Chief US Economist, and Lydia Boussour, Lead US Economist, discuss how the latest economic data point to a summer boom with supply gradually responding to stronger demand. While retail sales were softer than expected in May, the report fails to capture the ongoing consumer spending rotation into services. Meanwhile, industrial activity remains on a solid path, despite supply bottlenecks. They also discuss the Fed’s pivot away from its extremely accommodative stance, with more sanguine economic forecasts and a revised median interest rate ‘dot plot’ showing two rate hikes in 2023. With the Fed now actively discussing QE tapering, we continue to expect a formal announcement in August with tapering starting early next year, followed by two hikes in 2023.