Cliff dodged, ceiling looms - analyst

CLIFF DODGED, CEILING LOOMS - ANALYST The United States averted economic calamity on Tuesday when lawmakers approved a deal preventing huge tax hikes and spending cuts that would have pushed the world's largest economy off the "fiscal cliff" into recession. Christian Schulz, senior economist at Berenberg Bank, is confident U.S. politicians will reach a deal on the debt ceiling too, eventually. SHOWS: LONDON, ENGLAND, UK (JANUARY 02, 2012) (REUTERS - ACCESS ALL) 1. BERENBERG BANK SENIOR ECONOMIST, CHRISTIAN SCHULZ, SAYING: "Well, there is indeed a risk that there's going to be some external pressure after the internal pressure that we've now seen due to the fiscal cliff has really failed to produce a long-term strategy on how to deal with the cliff, external pressure might be what's coming up. But external pressure only from the rating agencies is unlikely to have a massive impact. We've seen that before in several countries when countries lose some AAA rating, or even if they lose a little bit more than that, that's not necessarily having an impact on borrowing costs, which would of course help to focus U.S. policymakers. But the fiscal cliff has produced some austerity, modest austerity, that's probably enough to allow the U.S. economy to still grow this year, which is a good thing for the U.S. and global economy. (QUESTION: What rate are you looking at this year?) Sorry? (QUESTION: What rate are you looking at for growth this year on the U.S.?) We're expecting about a 2% growth, so about the same as last year, that includes about 1% of fiscal drag. Now, the drag might be a little higher, but this data has been pretty good. So we would stick with our 2% growth target for the U.S. for 2013. (QUESTION: You start your note this morning with the sentence: Markets in the global economy can breathe a sigh of relief. Finally, not too late, Congress has done this. How long is this relief going to last, do you think?) Well, if the U.S. does not impose extra massive fiscal austerity, then the sigh of relief should really stay, but of course, we have probably once again, noisy negotiation ahead of us heading into February with a debt ceiling hitting and at the same time, the postponement of these automatic spending cuts will expire at the end of February as well. So we're going to have, once again, a pretty noisy negotiations. But one thing that we've learned both in 2011 and now, U.S. politicians will in the end do enough to avert major disasters striking the economy - at least if it's of their own making - and compromise in the end, so we also expect that for February and probably markets will be pretty sanguine about that as well."