LEIs Point Toward Continued Recovery

What's the outlook for the US economy in 2021? Alex Chausovsky, a senior business advisor for ITR Economics, said all 12 of their leading economic indicators (LEIs) are now pointing up, which means we should expect the recovery to continue through the remainder of this year.

Here's what he had to say in a recent interview with FS Insider (see Leading Indicators Are Sending a Surprisingly Positive Message for 2021, Says ITR's Alex Chausovsky for audio).

LEIs on the Rise

ITR Economics tracks 12 key leading indicators, Chausovsky noted, and all are currently in rising trends. This suggests we can expect 2021 to be more favorable than 2020, he added.

There's nothing currently to suggest the recovery that we saw begin to unfold over the summer and fall of 2020 has been derailed, Chausovsky noted. Right now, the outlook is positive, with the potential for a second and even a third stimulus package continuing to add support.

The recovery will begin to feel more tangible in the second quarter of 2021, Chausovsky added and should gain momentum into the second half of the year.

Other leading indicators ITR follows corroborate this narrative. The consumer remains strong, retail sales activity remains robust, and disposable personal income remains elevated relative to pre-pandemic levels.

“The way that we see things unfold right now, it is full steam ahead for the recovery,” Chausovsky said. “Consumers are actually still able to spend money, despite the fact that we are mostly locked up, doing so online rather than going to stores. … The CDC expects to get to about a million vaccinations per day over the next week or so. When you think about the implications of that, that's also going to be very supportive of some sort of normalcy re-emerging in day-to-day life by the second half of this year. All the evidence continues to corroborate the fact that, yes, there will be a business cycle rise in the U.S. economy.”

1 2 3 4
View single page >> |

To listen to our full-length interview with Alex Chausovsky, senior business advisor for ITR Economics,  more

How did you like this article? Let us know so we can better customize your reading experience.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.