S&P has cut its estimate for the US economy to 2.6%.

The forecast for US GDP growth for 2014 remains tepid. Indeed, as reported in Moneynews, rating agency Standard & Poor's (S&P) has cut its estimate for the US economy to 2.6%. Expected growth was pegged at 3.1% last quarter. S&P's cut in estimates is based on its expectation that there will be additional spending cuts in 2014. This in turn would lead to another round of political stand-off between the Democrats and the Republicans. Fundamentally speaking, economic fundamentals continue to remain weak in the US despite what the so called 'positive' jobs data suggests. It will be interesting to see what the US Fed chooses to do. If the economy stays weak, the Fed will not really go for QE taper. This means that money will continue to be pumped into the financial system. This will find its way into asset classes, which will see prices rise even when the ground reality is quite different.