Stimulus driven US economy grows a 38-year-peak 5.7% in 2021 as deficit soars
by SOURAV D | VIEW 708
In what could effortlessly mislead as a maverick upswing in US economy that had contracted 3.4 per cent in 2020 with a recession in first quarter as well, the US economy grew 5.7 per cent in 2021, the highest in 38 years, as the Government of an incumbent Biden Administration had poured trillions of dollars in pandemic aids with budget deficits hovering handsomely at record levels. In factuality, the Biden Administration had injected a whopping $6 trillion in form of pandemic-related aids last year that followed a near-bankruptcy of the US Treasury Department twice, suggesting that a robust US economic growth in 2021 was entirely based on Government debts which might have to be paid off by the Americans’ hard-earned money over a period that could span nearly a generation, said the analysts while raising a blazing question whether the pandemic-relief related growth could be contemplated as an indicator to real Gross Domestic Product (GDP).
US economy grows faster than Chinese economy for first time in two decades
Meanwhile, as the US economy had scored the strongest growth in nearly 38 years, painting a modest economic outlook over a near term, a senior economist at BMO Capital Markets in Toronto, Sal Guatieri said, “While Omicron will lead to weaker growth in the first quarter, activity is expected to rebound nicely once the latest pandemic wave abates and supply-chain glitches ease.
” Although, the US economic growth in 2021 was prodded by an injection of trillions of dollars in Government debts, it has been the first time the US economy grows faster than China in twenty years, the world’s second-largest economy which is expected to gross a GDP above the United States as early as by 2025.