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The
bank said in a note to clients that it now expects British gross
domestic product to grow by a "striking" 7.8% this year, "above
our expectations for the U.S."
Previously, Goldman had expected Britain's economy would grow by
7.1% this year and its forecast for U.S. growth in 2021 stands
at 7.2%, helped by U.S. President Joe Biden's huge fiscal
stimulus programme.
A Reuters poll of analysts published on April 13 showed an
average forecast for growth of 5.0% in the UK, the world's
fifth-biggest economy, in 2021. The International Monetary Fund
has projected a 5.3% expansion.
But since those forecasts were made there have been signs of an
acceleration in the pace of recovery with the country now having
given a first coronavirus vaccine to more than half of its total
population.
"The UK economy is rebounding sharply from the Covid crisis,"
Goldman Sachs said.
"The April flash PMI was much stronger than expected in the UK,
with the services PMI moving strongly further into expansionary
territory," it said.
The bank also noted a much-stronger-than-expected 5.4% monthly
jump in retail sales in March.
Britain's economy shrank by nearly 10% last year as it was hit
by longer coronavirus lockdowns than many of its peers. By
comparison, the U.S. economy shrank by an estimated 3.5%,
according to the IMF.
On Saturday, Bank of England Deputy Governor Ben Broadbent was
quoted as saying he expected "very rapid growth at least over
the next couple of quarters" as the country lifts its
coronavirus restrictions.
(Writing by William Schomberg; Editing by Susan Fenton)
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