Pick-up in growth will prompt more Fed tightening

We suspect that any fiscal stimulus will now be delayed until early next year, but the recent strength of the survey evidence suggests that GDP growth will still be a healthy 2.3% this year, up from 1.6% in 2016. We expect the stimulus to boost GDP growth to 2.5% in 2018, although growth will then slow to only 1.7% in 2019. Although we suspect that any fiscal stimulus will now be delayed until early next year, the recent strength of the survey evidence, which seems to reflect an upturn in the global economy, suggests that GDP growth will be a healthy 2.3% this year, up from 1.6% in 2016. We expect the stimulus to boost GDP growth to 2.5% in 2018.