See gradual acceleration of price pressures

Bloomberg is out with a report saying Goldman and Barclays are seeing good times ahead in global growth and that could mean 4% or above in 2018.

A growth of 4% would be the strongest since 2011.

Barclays Ajay Rajadhyaksha and Michael Gavin say the growth forecast is "not reliant on any single geographical region, industry or source of demand". They also point out that the growth is not generating "economic or financial excesses" that would be a threat to future growth.

Goldman's Hatzius calls the growth prospects "as good as it gets".

Despite strong growth estimates, few economists are seeing a surge in inflation. Most see a gradual acceleration. Goldman, however, is a bit more aggressive, seeing four Fed tightenings in 2018.

Other banks forecasts for 2018:

  • JP Morgan: 3.7%. Along with strong growth, they expect inflation will rise and central bank normalization will gather steam
  • Morgan Stanley: 3.7%. They say "with major economies at different stages, the risk of global economy running too hot is limited"
  • Societe Generale: 3.7%. They say the global economy is at the "best shape in about a decade". They also see all 45 OECD countries experiencing growth in 2018 with no signs of overheating. It is a "Goldilocks scenario"
  • Citigroup: 3.4%. Sees higher growth, steady inflation and rising advanced economy policy rates. Downside risks are slowdown in China, geopolitical or trade tensions, tightening of global financial conditions, including central bank tightenings and asset purchase fades.