A report by Goldman Sachs Group Inc (NYSE:GS) last week takes a look at the various estimates for U.S. GDP during 2014 and beyond and presents a study of EPS sensitivity to GDP growth.
GDP growth estimates
On an annual average basis, the midpoint of the Federal Reserve central tendency of GDP growth for 2014 is 2.8%. It is 3.2% in 2015 and 3.0% in 2016.
Goldman Sachs forecasts average annual growth of 2.9% in 2014, up from the 1.8% calculated by annualizing 1H 2013, due basically to the passing of the impact of the 2013 payroll tax increase and the initial sequester phase.
Other estimates vary from 2.0 to nearly 3.0%.
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