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We're Forecasting a Strong Long-Run Economic Recovery

johnNjohnN
in Fund Discussions
https://www.morningstar.com/articles/989371/were-forecasting-a-strong-long-run-economic-recovery

We're Forecasting a Strong Long-Run Economic Recovery

We don't think the market's engaging in irrational exuberance.


Preston Caldwell
Jun 30, 2020



The Morningstar US Market Index has come thundering back since its late March nadir and is now down merely 7% year to date, even as the coronavirus pandemic persists. While many investors are wondering if the market is exhibiting irrational exuberance, we think the rebound has been broadly warranted, as we forecast a strong long-run recovery in the U.S. economy. We expect U.S. GDP to drop 5.1% in 2020 but surge back in 2021 and experience further catch-up growth in following years. By 2024, we think U.S. GDP will recover to just 1% below our expectations before the pandemic.

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