US Economy Forecast August 2009
In particular, MBA predicts that the US real GDP will grow by 2.6% in the third quarter of 2009 and by 2.3% in the fourth quarter. Overall, real GDP in the fourth quarter of 2009 is expected to be only 0.7%, below its fourth quarter 2008 level. It should be noted that US GDP contracted sharply in the first quarter of 2009 at an annual rate of 6.4%. However, the rate of decline in the second quarter of 2009 decelerated significantly to 1%. Business fixed investment, which registered very sharp declines in the first and second quarters of 2009 (39.2% and 8.9%, respectively) is predicted to continue to decrease in the third and fourth quarters of 2009, by 4.5% and 5.6%, respectively. Net exports and inventory investment are also expected to be negative during the same period. Despite predictions of a growing economy, the job market is expected to continue to deteriorate and the unemployment rate to climb from 9.2% in the second quarter of 2009 to 9.9% by the end of the year, and peak in the second quarter of 2010 at 10.2%. MBA predicts a slow improvement of the job market after the second quarter of 2010, with the unemployment rate dropping gradually to 9.1% by the fourth quarter of 2011. The MBA US economy forecast predicts that growth will continue at a moderate pace (below 2%) in the first half of 2010 and accelerate in the second half of 2010 with growth rates in excess of 2.5%. Residential investment is expected to be a major driver of GDP growth in 2010, with growth rates ranging between 7.5% and 13.8%. In 2011, GDP growth is expected to accelerate further (above 3%) with the US economy expanding at an average annual rate of 3.4%. Both residential and business fixed investments are predicted to be major drivers of the expansion of the US economy in 2011, with average annual growth rates in excess of 20% and 9%, respectively.
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