The US economy is decelerating toward potential gross domestic product (GDP) of nearly two per cent, but not going into recession, according to David Lafferty, chief market strategist for Natixis Investment Managers.
Lafferty said the quarterly real GDP of 3.2 per cent annualised was much better than what had been expected from November to February.
“While we consider 3.2 per cent growth to be a head fake, we still see very little in the data that would imply that growth is stalling or that a recession is imminent,” Lafferty said.
Recent data from China had shown improvement from last year’s second half slowdown and the weakness in Chinese exports had appeared to be fading, while industrial production had gone up one per cent in March, the largest monthly jump in five years.
However, based on the overall data, Lafferty said it would be too optimistic to get excited for global growth to bloom.