The U.S. economy remains on solid footing, continuing to move into a period of exceptional growth.
Examining performance trends over the past year reveals a nuanced relationship.
Over the past 70 years, rising government debt generally has been accompanied by weaker economic activity. But it’s not a simple relationship.
Vaccine rollouts in major countries are proceeding at different speeds, and investors are torn between optimism about business re-openings and concern about rising interest rates.
Easy monetary policy and rising federal budget deficits could undermine confidence in the dollar, but its role as the dominant global currency looks secure.
The Fed kept rates unchanged, but upgraded its outlook; while the “dots plot” moved higher amid a rising percentage of officials expecting an earlier “lift off” in rates.
China’s growth for 2021 appears strong, but February holds key developments that could impact this outlook, including stock delistings, trade, and COVID-19.
2021 Schwab Market Outlook
With COVID-19 vaccines on the horizon, the longer-term economic outlook appears brighter.