NEW YORK (Reuters) - Private-sector economists expect economic growth to rebound in the first half of 2006 and anticipate the U.S. economy to steady in the second half, a Federal Reserve Bank of Philadelphia survey said on Monday.
Economists raised their forecasts for annualized growth in real gross domestic product for the first and second quarter to 4.4 percent and 3.4 percent from 3.7 percent and 3.3 percent, respectively. They expect growth for 2006 and 2007 at 3.2 percent, down from the previous estimate for this year of 3.4 percent, the bank said in its quarterly Survey of Professional Forecasters.
"These rates are the same as the forecasters' new estimate of average annual growth over the next 10 years, suggesting that they see little in the way of transitional dynamics in the U.S. economy over the medium and long run," the survey said.
Though the 53 economists polled expect the unemployment rate to hold steady at 4.8 percent all year, they revised down their forecasts for average monthly payrolls growth in each quarter.
For the current quarter, economists lowered their prediction to 187,700 new jobs per month from the previous forecast of 199,000.
Economists expect inflation to stay contained, particularly in the first quarter of 2006. They expect a 2.0 percent first-quarter reading on the consumer price index on a year-over-year basis. For the year, CPI is seen averaging 2.4 percent.
Over the next 10 years, economists see economic growth averaging 3.2 percent a year, similar to their prior forecast of 3.3 percent made in the first quarter of 2005.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.