Bank of America cuts 2018 U.S. GDP view to 2.1 percent

NEW YORK (Reuters) – Bank of America Merrill Lynch on Friday downgraded its outlook on U.S. gross domestic product in 2018 to 2.1 percent from an earlier forecast of 2.5 percent, citing fading prospects on tax reform, policy uncertainty in Washington and likely weaker auto production.

“Hopes for a big fiscal stimulus have faded, prompting us to remove most of the fiscal impulse from our forecast for growth next year,” Michelle Meyer, the firm’s head of U.S. economics, wrote in a research note. “We do not believe that fiscal easing is a necessary condition for the recovery to persist.”