US: GDP growth keeping a decent pace - BNPP

US GDP growth is keeping a decent 2% pace and picked-up a bit in Q2, but the fiscal outlook remains uncertain, according to analysts at BNP Paribas.

Key Quotes

“A fiscal stimulus still is possible, but it would not be implemented before end-2017. Potential effects are thus uncertain.”

“The labour market is as buoyant as ever. Still, the support to households’ disposable income is not as strong as it looks as wage inflation remains limited.”

“With inflation relatively muted at this stage of the cycle, the Fed is in no rush to increase rates. We forecast the Fed Funds target rates to come at 1.25% by year-end, 2.00% by mid-2018.”