Improving activity surveys points to strong first half

The economic outlook appears to have improved recently, with both the ISM manufacturing and non-manufacturing indices improving to multi-year highs in January. We certainly anticipate a strong first half of this year. Buoyed by the latest round of fiscal stimulus, we expect GDP growth to average in excess of 3% annualised. Nevertheless, we still fear that growth will slow in the second half of the year, as the initial impulse from that stimulus begins to fade.