- Allen Sinai, chief executive officer of Decision Economics
The US, the world's biggest economy is seen growing 3.2% or even more in 2015, the best performance since 2005, as a strengthening job market underpin consumer spending. Around 3 million Americans were employed in 2014, the most in 15 years, reinforcing the view US companies believe US demand will persist even as foreign markets struggle. Although wage gains have been timid, with average hourly earnings dropping 0.2% in December compared with the previous month, they are expected to accelerate as the labour market continues to tighten. Spending has been increasing. Households spent lavishly on new cars, durable white goods and clothing as spending rose 0.6% in November, double the increase in October, according to the Commerce Department. Light-vehicle sales totalled 16.5 million in 2014, the most since 2006. Deutsche Bank expects US GDP to grow 3.7% this year, after expanding 2.5% in 2014. Thus, the world's number one economy will contribute almost 18% to global growth of 3.6% in 2015, compared with 11% for all other industrial countries combined.
Thus, Janet Yellen, the first woman to lead the Fed, who completes her first year as the Chairwoman on 3 February, is managing a smooth exit from the central bank's unprecedented stimulus and carefully prepares investors for increasing interest rates this year.
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