U.S. economy to expand 3.3 percent in 2011: NABE survey
2011-03-01 18:19:36
U.S. real gross domestic product (GDP) is expected to grow faster than previously estimated as demand from consumers, businesses and other countries picks up, according to a survey released Monday by U.S. National Association for Business Economics (NABE).
The NABE said that U.S. economy would grow 3.3 percent year-on- year in 2011, up from the previous prediction of 2.6 percent in last November. The economy growth in 2012 is expected to edge up to 3.4 percent.
"Factors supporting growth going forward include pent-up consumer and business demand, strong growth in foreign economies, especially those in Asia, and accommodative monetary policy. Factors restraining growth include financial headwinds, uncertainty about future federal government economic policies, a tepid housing market, and sustained high unemployment," said NABE President Richard Wobbekind.
"Panelists do remain confident about the expansion's durability, but are concerned about high levels of government deficits and debt, excessive unemployment, and rising commodity prices."
The consumer spending will expand 3.2 percent this year, up from the previous forecast of 2.4 percent; business investment in equipment and software will grow 12.1 percent; export growth this year would exceed import growth rising 8.6 percent, according to the survey.
However, the NABE said that housing market would lag behind the rest of the economy. Most respondents said home prices would only increase 0.4 percent.
Moreover, respondents also forecast that the U.S. federal deficit would widen to 1.4 trillion dollars this year.
Because of persistently high unemployment and low inflation, the NABE pushed back its forecast for the Fed's first increase in its benchmark interest rate to the first quarter of 2012.
With respect to inflation, the economists expected the consumer price index excluding food and energy costs to increase only 1.2 percent in 2011.
This survey covered forecasts from a panel of 47 professional forecasters, conducted between Jan. 25 and Feb. 9. The National Association for Business Economics, founded in 1959, is the professional organization for people who use economics in their work.