White House backpedals growth forecast

The White House toned down its forecast for economic growth for 2008, but still predicted "solid growth" throughout the year. That prediction is more optimistic than that of the Federal Reserve and Wall Street economists. The Bush administration estimated that the U.S. economy would expand at a 2.7% clip, short of the 3.1% rate it predicted in June. In addition, Edward P. Lazear, chairman of the Council of Economic Advisers, expressed concern that the decline in the housing market has been "more pronounced" that was forecast when the mid-year review was compiled. The White House also estimated that unemployment would rise to 4.9%, up slightly from its earlier prediction of 4.7%. In a gloomier mode, the Federal Reserve officials predicted "subpar" growth through next year, starting with a slowdown over the next six months. Federal Reserve policy markers predicted that growth will slow between 1.8% and 2.5% next year.