Sustaining the recovery

US growth should remain robust. While government transfers continue to be pared back, the resurgence of the service sector will be more than enough to keep activity rates up. The labour market recovery should underpin all of this, as employment accelerates, recouping the gap created by the pandemic relative to GDP – which has recovered far more quickly. This is a positive dollar story. It is also positive for risk assets, but not the Covid-winners, which must reconnect with trend.

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