The U.S. economy has roared back to life in 2021, with firstquarter growth set to defy even the rosiest expectations as another fresh influx of cash looms. Manufacturing data Monday showed the sector at its highest growth level since August 2018. That report from the Institute for Supply Management in turn helped confirm the notion among economists that output to start the year is far better than the low singledigit growth many had been predicting in late 2020.
The Atlanta Federal Reserve, which tracks data in real time to estimate changes in gross domestic product, now is indicating a 10 gain for the first three months of the year. The GDPNow tool generally is volatile early in the quarter then becomes more accurate as the data rolls in through the period.
That comes on the heels of a report Friday showing that personal income surged 10 in January, thanks largely to 600 stimulus checks from the government. Household wealth increased nearly 2 trillion for the month while spending rose just 2.4, or 340.9 billion. Those numbers, along with a burst of nearly 4 trillion in savings, pointed to an economy not only growing powerfully but also one that is poised to continue that path through the year.
Economists previously hadnt expected the 21.5 trillion U.S. economy to regain its pandemicrelated losses until at least the second or third quarter of this year, if not later.But a combination of systematic resilience combined with previously unimaginable doses of fiscal and…