The UBS’s research report released on February 6 pointed out that the U.S. economy seems to have entered a virtuous circle, which reduces the possibility of the further introduction of the third round of quantitative easing (QE3).
UBS pointed out that the United States significantly improvement of the employment data in January further proves that the U.S. economy is entering a virtuous circle. The UBS U.S. macro team raised the 2012 first quarter annualized GDP growth from 1.5% to 2.3%, mainly due to the release of the previous suppressed consumer demand, the decline in initial jobless claims and the improvement of the credit conditions, in addition to a forecast of the federal government spending rebound. Although the debt crisis in Europe still poses a risk in exports to the U.S., UBS believes that the 2012 U.S. economic growth will continue to accelerate.
The decrease in the unemployment rate is significantly faster than the previous forecast of UBS. The UBS U.S. macro team lowered the 2012 and 2013 U.S. unemployment rate from 7.9% and 8.6% to 7.7% and 8.2% respectively.
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