rain
Saturday July 4th, 2015 7:53AM

Economists downgrade forecasts for US growth

By The Associated Press
WASHINGTON (AP) -- U.S. business economists have sharply cut their growth forecasts for the April-June quarter and 2014, though they remain optimistic that the economy will rebound from a dismal first quarter.<br /> <br /> A survey by the National Association of Business Economics, released Friday, found that economists expect, on average, growth of 3 percent at an annual rate in the second quarter. That's down from 3.5 percent in a June survey. Growth in 2014 as a whole will be just 1.6 percent, they project, sharply below a previous forecast of 2.5 percent.<br /> <br /> The lower 2014 forecast largely reflects the impact of a sharp contraction in the first quarter. The economy shrank 2.9 percent at an annual rate, the biggest drop in five years. That decline will weigh heavily on the economy this year, even if growth resumes and stays at 3 percent or above, as most economists expect.<br /> <br /> The economists reduced their second-quarter forecast largely because they expect consumers spent at a much more modest pace. They now expect spending will grow just 2.3 percent at an annual rate in the second quarter, down from a 2.9 percent estimate in June. Spending rose just 1 percent in the first quarter, the smallest increase in four years, a sign consumers are still reluctant to spend freely,<br /> <br /> The NABE did a special survey after the government announced the dismal figures at the end of June. The group typically surveys economists quarterly.<br /> <br /> Despite the downgrades, the survey underscores that economists are mostly optimistic about the rest of this year. Analysts largely blame the first quarter shrinkage on temporary factors, such as harsh winter weather and a sharp slowdown in inventory restocking. When companies restock their inventories at a weaker pace, it slows demand for factory goods and lowers production.<br /> <br /> Jack Kleinhenz, president of the association and chief economist at the National Retail Federation, said that most other recent economic data, particularly regarding hiring, has been positive. Employers have added an average of 230,000 jobs a month this year, one of the best stretches since the recession.<br /> <br /> In addition, consumers are more confident and government spending cuts and tax increases are exerting less of a drag. In 2013, a Social Security tax cut expired and government spending cuts were implemented. The combined effects slowed growth by 1.5 percentage points, some economists estimate.<br /> <br /> "Many of the fundamentals are there for growth," Kleinhenz said.<br /> <br /> As a result, the 50 economists who responded to the survey see the chances of a recession this year or next as pretty low. Sixty percent said the odds were 10 percent or lower, and more than 90 percent said they were 25 percent or lower.
© Copyright 2015 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Judge denies motions to move, delay Tsarnaev trial
Lawyers for Boston Marathon bombing suspect Dzhokhar Tsarnaev asked a federal appeals court Wednesday to overturn a judge's decision to not move his upcoming trial out of state.
10:02PM ( 6 months ago )
High court to adopt electronic filing of cases
The Supreme Court is belatedly developing an electronic filing system similar to those used in courts around the country, Chief Justice John Roberts said Wednesday in his annual end-of-year report.
7:57PM ( 6 months ago )
Storm brings snow, cold to West for New Year's
A blustery winter storm dumped snow and ice across the West on Wednesday, making driving treacherous in the mountains from California to the Rockies and forcing residents and party-goers in some usually sun-soaked cities to bundle up for a frosty New Year's.
5:19PM ( 6 months ago )
U.S. News
State DOT awards $48M contract for NE Ga. road project
The state Department of Transportation has awarded a $47.8 million contract for nine miles of work on a northeast Georgia road.
9:37AM ( 6 months ago )
Business News
Grass fire impacts rush hour traffic on 985
Rush hour traffic on I-985 was slowed by a grass fire Wednesay afternoon with one lane closed while firefighters fought the blaze.
10:19PM ( 6 months ago )
Hall County conviction, sentencing to be reviewed by SCOGA
The State Supreme Court has agreed to hear the appeal of a Hall County man when they reconvene in January.
2:37PM ( 6 months ago )
Maysville man dies from Banks County wreck
The Georgia State Patrol reports that alcohol and/or drugs were factors a single-vehicle wreck that claimed the life of a Maysville man in Banks County Tuesday night.
11:07AM ( 6 months ago )
Local/State News
VIDEO: "'76 For Our Sacred Honor"
AccessWDUN presents a special video presentation in celebration of our nation's Independence Day. It was produced by AccessWDUN Videographer David Cook.
By AccessWDUN
3:00PM ( 7 hours from now )
America welcomes July 4 with hot dogs, cool music, cold beer
As the nation gears up to celebrate America's birthday, here are some Fourth of July highlights from around the country:___IN AMERICA'S BIRTHPLACE: CONCERTS, A PARADE AND BEERPhiladelphia started its...
1:06AM ( 6 hours ago )
Bubba Watson to remove Confederate flag from 'General Lee'
WHITE SULPHUR SPRINGS, W.Va. (AP) — Bubba Watson says he's painting over the Confederate flag on his car made popular in "The Dukes of Hazzard" television series.The two-time Masters champ said Friday...
6:57PM ( 12 hours ago )
Billy Dilworth veteran Georgia, SC journalist dies at 80
A veteran journalist whose career touched newspapers, radio and television stations in Georgia and South Carolina has died in northeast Georgia.
5:32PM ( 14 hours ago )
Forsyth Co. water main break shuts down Shiloh at Majors Rd.
Forsyth County officials are urging drivers to stay away from Shiloh Road at Majors Road while they try to repair a watermain break.
1:40PM ( 18 hours ago )