Contact

News

 

U.S. Economy Slower but Still Steady


The solid economic growth seen in the third quarter could be difficult for the U.S. economy to match through the end of next year, according to economists, but most still see growth nonetheless.

The final report Wednesday on the gross domestic product, the broad measure of the nation's economic activity, showed 4.0 percent growth in the quarter, a bit better than the previous reading and economists' forecasts of 3.9 percent growth in the period.

But October's hike in energy prices and the continual rise in interest rates have most economists looking for a slowdown going forward...

Still the economy is generally seen as relatively strong and able to resist hits such as energy price spikes and rising interest rates without falling into recession.

That's partly because economists see businesses are relatively well positioned to be spending in 2005, due to strong balance sheets and unusually slow spending and hiring during the growth of the last year.

"The expansion we have now is a resilient one. At this point in the business cycle, even if you have significant shocks from oil, terrorism or [a] big drop in dollar, they are not going to derail the expansion," said Anirvan Banerji, director of research at the Economic Cycle Research Institute.

But even economists such as Banerji who see a strong economy overall don't see much signs of faster economic growth going forward.

While some economists, including Banerji..., see little or no risk of the economy slowing into recession next year...