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By Anna STUPNYTSKA, Global Economist and Wen-Wen Lindroth Senior Credit Analyst
In our baseline scenario of a split Congress, we believe US GDP growth is likely to disappoint, coming in below the current Bloomberg consensus of 2.5 per cent in 2019 and 1.9 per cent in 2020. The main driver behind the slowdown will be the combination of fading fiscal stimulus and tighter financial conditions - a reversal of trends that boosted the US economy throughout 2017-2018.
While the headline US growth remains strong for the time being, tentative signs of a slowdown are already appearing in sectors that are particularly sensitive to interest rates, such as housing and consumer durables. Moreover, there is growing evidence that capital expenditure by...
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