3) The fiscal cliff would amount to a 4.5 % - of -
GDP drag on growth in 2013 if all tax cuts and transfer payments were allowed to expire and draconian spending cuts were triggered.
Not exact matches
In a recent note to clients, Madani wrote that housing investment may continue to assist
GDP growth throughout the rest of 2013, «but there are still tentative signs that a day of reckoning lies around the corner, with housing likely to become a significant
drag on growth next year.»
«Our view has been that the boost to real incomes from lower energy prices — and its positive impact
on consumer spending — would offset the
drag from energy - related investment, resulting in gains for US
GDP growth on net,» Hui Shan and Zach Pandl said in their report.
A sharp sell off in the equity market «exerts a significant
drag on world
growth» in the period that follows, according to Deutsche Bank, with real
GDP reduced by about 0.5 percentage points.
The percentage - point
drag on the U.S.
GDP growth between 2006 and 2011 attributable to fiscal uncertainty, according to one study.
To see why this is so important, in 2009 residential investment exerted a 0.4 percentage point
drag on GDP growth, while in 2013 it is likely to provide a boost to
growth on the order of 0.5 percentage point — a swing of nearly a full percentage point.
Now, my understanding of your position is that you made that original prediction based
on the belief that the PRC would be instituting reforms to deleverage aggressively and transfer wealth to the consumer (such that the incorrect prediction was more that you were overly optimistic about the PRC's willingness to head off these systematic risks) and that your current prognosis of ~ 3 %
GDP growth has an entirely separate causative element; that is to say, your previous prediction was based
on the idea the PRC would be enacting reforms to ward off systematic risks, whereas your current estimation of
GDP growth is instead based
on the
drag produced by these very systematic risks the PRC has failed to deal with.
Morgan Stanley U.S. chief economist Ellen Zentner estimates that a 20 % broad - based tariff increase could, after four quarters, result in a 1 percentage point
drag on real U.S.
GDP growth.
These debt loads act as a
drag on growth and impede achieving escape velocity for
GDP growth.
In his article «The Age of Secular Stagnation,» Larry Summers argued that excess of saving over investment is acting as a
drag on demand to weigh
on growth and inflation, and current monetary stimulus should be expanded to accelerate investments and pull demand forward, such as raising the inflation target or to conduct nominal
GDP targeting.
Consumer spending in particular exerted a -0.5 %
drag on GDP growth, and appears to have continued into the new year with a -0.2 % fall of consumer spending in January despite better employment
growth (+1.4 % yoy) and lower unemployment (3.2 % in January).
In contrast to strong domestic demand, net exports have acted as a substantial
drag on GDP growth over the past couple of years, although this
drag has begun to diminish.
Durable goods spending fell 2.5 % sequentially (SAAR), with motor vehicles accounting for a 45 basis - point
drag on overall quarterly
GDP growth in Q1, underscoring the deceleration of fundamentals in the auto industry.
However, net trade was likely an even bigger
drag on GDP growth in Q1, which supports the consensus for a weaker rate of expansion in Q1 2018.
NAHB is currently forecasting 2.8 percent
growth, but that is because our forecast assumes that the fiscal cliff is for the most part avoided (producing only a 1 to 1.5 percentage point
drag on GDP, compared to the 3.9 percentage point
drag estimated by CBO).
However, if the full fiscal
drag is inflicted
on the economy it would clearly be harmful to
GDP growth.