Goldman’s Abby Cohen Expects Economic Growth to Slow to 2.5% in 2010, Sees S&P to 1,300

Market analyst and chief equity strategist at Goldman Sachs (GS) Abby Joseph Cohen told CNBC today that while the economy is growing by as much as 4.5% in the current quarter, growth will slow to 2.5% in 2010.

“Next year, our GDP forecast is below consensus,” said Cohn. “Under normal post-recession conditions, we would be expecting GDP next year of 3% to 3.5% in 2010, but we have trimmed that number down to 2.5% because of continued concern about labor markets and household balance sheets which continue to de-lever…We’re seeing many consumers are coming back, but very importantly we’re seeing very good growth in exports and also in business investment, especially for equipment and things that enhance worker productivity. The growth this quarter may be as much as 4% even 4.5%. And we do think that that slows a little bit because inventories have already been rebuilt,” she said.

Cohen also said she expects “less pop from stimulus, but that’s still a good environment from the stock market.” According to Cohen, Goldman’s US portfolio strategy team sees the S&P’s fair value being between 1,250 -1,300 range.