The world economy is expanding, with two of the three biggest regions doing well, says Robert Doll, senior portfolio manager and chief equity strategist for Nuveen.
Speaking on Monday at the FPA of Metro New York’s 20th Annual Forum in Manhattan, Doll said the U.S. economy is doing “reasonably well” and should continue to grow this year. It is growing at a stronger rate than it has seen in the last decade
China has also started to expand again. But Europe, he adds, is “the weak link in the world economy,” according to Doll, who also offered a Nuveen report on the world’s economy
Why is the global economy on the upswing?
Doll said it is partly because central banks continue to push cheap money policies. Hence, the expansion, in the two biggest economies of the world, should continue.
The U.S economy should grow by two to two and a half percent this year, Doll says.
This would make the “U.S. expansion the longest in history,” according to the Nuveen report.
Doll says the Federal Reserve, which he said last year had been talking about raising rates but now dismisses such talk, “had the largest pivot in the shortest period of time in history.”
He noted the turnaround came after last year fourth quarter, “when one would have believed they were going to raise rates in every quarter for the rest of our lives,” a comment that he says is “only a slight exaggeration.” He says the pivot was “mind boggling” and was one reason why there was so much volatility in the market last year.
Doll says that now he isn’t sure where the central bank is going. “I am boringly neutral,” he says.
Doll, who said “I see no signs of a recession this year,” predicts the economy’s expansion will slow this year and that recession will probably happen in 2021. Doll also believes that historically low unemployment rates will bottom out this year and this will eventually lead to increased wage inflation.