US consumer spending to fall

By Leo Bland Goldman Sachs is cutting its US real GDP growth forecast for next year on the back of doubts over the sustainability of strong domestic consumer spending. The group is reducing its 2001 forecast for US real GDP growth to 3.3% from 4% as it believes consumer spending growth is set to slow to between 2.5% and 3% over the next 12 months from around 4%. Gavyn Davies, chief international economist at Goldman Sachs, said that consumer spending growth has slowed much less than the growth rate in disposable income. He believes this is because earlier rapid gains in the US stock mar...