The US’ gross domestic product (GDP) forecast for 2021 and 2022 is lowered by Goldman Sachs on Tuesday.

The American multinational investment bank and financial services company has lowered its GDP growth forecast for this year to 5.7%, from 6.2%.

This marked the second time in a month that the New York-based firm has cut its GDP forecast for the US after Aug. 18 when it steeply lowered the third-quarter estimate to 5.5% from 9%.

Goldman Sachs said the downgrade reflects “a larger effect of the Delta variant on services spending,” adding: “Although we expect the Delta setback to be brief, two longer-standing concerns pose challenges for consumption growth over the next few quarters.”

“The Delta variant is already weighing on Q3 growth, and fading fiscal stimulus and a slower service sector recovery will both be headwinds in the medium term,” it said.

First, the firm said it believes the US government’s fiscal impulse will fade sharply from its second-quarter peak through the end of 2022.

Second, it said US consumers will need to rotate from a high level of spending back to normal on services, noting “Spending on goods is likely to continue falling, though delayed purchases due to shortages of items such as new cars should slow the decline.”

Goldman Sachs, however, lifted its 2022 growth forecast for US GDP to 4.6%, from 4.3%.

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