The U.S. economy is expected to begin growing in the second half of
this year, while the jobless rate is expected to peak in the first
quarter of 2010, according to a survey of top forecasters released on
The consensus forecast of
panelists surveyed in the Blue Chip Economic Indicators newsletter for
May predicted economic growth, as measured by real gross domestic
product, would shrink 2.8 percent in 2009 but grow 1.9 percent in 2010.
economic downturn is expected to ease in the second quarter of this
year after sharp declines in the fourth quarter of last year and the
first quarter of this year, the survey said. Growth is forecast to
resume in the third quarter.
The May consensus forecast from the
economists saw second-quarter GDP contracting at a 1.7 percent annual
rate, 0.4 percentage point better than was forecast a month ago.
In April, the panelists forecast GDP would contract 2.6 percent in 2009 and grow 1.8 percent in 2010.
past month provided fresh evidence the decline in business activity is
starting to moderate, buttressing consensus expectations that the
economy will emerge from recession in the second half of this year,
the newsletter said.
The economy is showing some signs of inching toward health.
four-week average of new jobless claims, a better gauge of underlying
labor trends because it irons out week-to-week volatility, have fallen
for fourth straight weeks.
The Institute of Supply Management's
index of activity in the manufacturing sector increased to a
seven-month high in April while its index of activity in the service
sector jumped to its highest level since October.
percent of the panelists believe total housing starts are at or near a
bottom and residential investment is likely to subtract considerably
less if any from GDP in the second quarter and might conceivably begin
to contribute slightly to growth by year's end, the survey showed.
The consensus forecast put inflation-adjusted GDP growth in the
third quarter of 2009 at a 0.5 percent annual rate compared with a
month-earlier forecast of a 0.4 percent rise. Growth in the fourth
quarter is seen at 1.8 percent compared with a 1.6 percent rise
forecast a month ago.
While economic growth is expected later in
2009, nearly 32 percent of the panelists expect the unemployment rate
to peak in the first quarter of 2010. They forecast the jobless rate to
peak at 10 percent, compared with their 9.8 percent forecast in the
The Labor Department put the unemployment rate at 8.9 percent in April, the highest since September 1983, from 8.5 percent.
The survey was conducted May 4-5.