Economists split on recession odds

Economists predict a slow beginning to 2008, according to a recent study conducted by the National Association for Business Economics. The real U.S. GDP will rise by just 2.9% in 2008 due to decreased expectations for consumer spending and the housing sector, according to experts polled in the study. The economists also expect the trade deficit to decline over the coming year. “While a slight majority of our panel of forecasters expects the economy to avoid a recession in 2008, growth is expected to average just three-quarters before accelerating in the second half in response to fiscal and monetary stimulus,” stated Ellen Hughes-Cromwick, president of NABE and chief economist at the Ford Motor Company in a statement released along with the study’s results. The panel expected the Office of Federal Housing Enterprise Oversight index of housing prices to decline 4% in 2008, the first negative movement in the index’s history, followed by a 0.1% increase in 2009. The study, conducted from January 25th to February 13th by NABE, polled a group of 49 professional forecasters about the macroeconomic future of America.