BofAML: Pro-growth US policy to remain for 2019

Bank of America Merrill Lynch analysts suggest that in their view, U.S. economic policy is set to remain pro-growth for the balance of 2019.

Key Quotes

“Monetary policy is the biggest new tailwind, yet price inflation is likely going nowhere fast, putting little pressure on the Federal Reserve (Fed) to raise rates again.”

“On the regulatory side, the Council of Economic Advisers (CEA) continues to sift through burdensome regulations, running cost-benefit analysis in an effort to boost growth. 2019 will likely be even better for growth than 2018 on the deregulatory front.”

“While fiscal deficit and amount of debt are gaining more attention, for a number of reasons, including our belief that nominal growth is likely to continue to run well above rates for foreseeable future, a fiscal crisis is far down our list of risks to the U.S. economy.”

“Lastly, we continue to believe that there is an end in sight to trade wars. In the end, terms will likely be more favorable for U.S. and global economy in terms of tariff and nontariff barriers, joint venture requirements, intellectual property protection & enforcement.”