Most econ­o­mists see US growth above 2%: poll

The Nation - - WORLD BUSINESS -

MOST busi­ness econ­o­mists pre­dict that US eco­nomic growth will sur­pass 2 per cent over the next year, de­spite soft­en­ing in some busi­ness con­di­tions, ac­cord­ing to the lat­est sur­vey.

The im­prov­ing fore­casts for US growth come amid a weak­en­ing profit out­look and con­tin­ued un­cer­tainty over thorny de­bates in Wash­ing­ton on trade and tax pol­icy, said the Na­tional As­so­ci­a­tion for Busi­ness Eco­nom­ics, sum­maris­ing a quar­terly sur­vey of 85 econ­o­mists.

“Pol­icy de­vel­op­ments, in­clud­ing those af­fect­ing the North Amer­ica Free Trade Agree­ment, re­main on the panel’s list of con­cerns, but con­tinue to have lim­ited im­pact on busi­ness de­ci­sion-mak­ing with re­gard to hir­ing or in­vest­ment,” said Emily Kolin­ski Mor­ris, chief econ­o­mist at Ford.

“The re­cent hur­ri­canes ap­pear to have had rel­a­tively lim­ited im­pact on re­spon­dents’ firms, with more than 80 per cent of pan­el­lists re­port­ing no an­tic­i­pated im­pact on their busi­ness in the third or fourth quar­ters due to hur­ri­canes Har­vey and Irma.”

The out­look for real gross do­mes­tic prod­uct growth “im­proved ma­te­ri­ally” in the Oc­to­ber sur­vey com­pared with July, the re­port said.

Eighty per cent of the group pre­dicted that growth would run be­tween 2.1 per cent and 3.0 per cent over the next 12 months, while 15 per cent saw it run­ning be­tween 1.1 per cent and 2.0 per cent, the re­port said.

Al­though US growth came in at 3.1 per cent in the sec­ond quar­ter, ac­cord­ing to of­fi­cial data, growth was just 1.2 per cent in the first quar­ter. US growth came in at 1.5 per cent in 2016 and 2.9 per cent in 2015. The sur­vey found busi­ness econ­o­mists broadly up­beat on fu­ture sales and most firms not re­port­ing dif­fi­culty hir­ing staff de­spite lower un­em­ploy­ment lev­els.

On the down­side, the re­port showed fewer firms ex­pect profit mar­gins to rise com­pared with the July sur­vey. Busi­nesses also re­ported an in­crease in ma­te­ri­als costs, al­though this bench­mark in Oc­to­ber was still be­low the level in Jan­uary and April.

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