The Goldman Sachs Exchanges podcast explores the economic and market outlook for 2026, characterized by "Sturdy Growth, Stagnant Jobs, Stable Prices." Jan Hatzius and Dominic Wilson discuss their optimistic growth forecast for the U.S., driven by factors like tax cuts and the fading impact of tariffs. While projecting above-consensus growth for China, they acknowledge the growing external imbalance and its potential drag on European economies, particularly Germany. They also address the disconnect between solid economic growth and labor market performance, attributing it to stronger productivity growth, with AI's impact yet to be fully realized. Despite anticipating continued disinflation and potential rate cuts by central banks, they caution against risks such as labor market deterioration and high equity valuations.
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