2009 US economic outlook worsens - ACC survey

13 February 2009 20:07  [Source: ICIS news]

HOUSTON (ICIS news)--The 2009 US economic outlook worsened in a survey of economists released on Friday by the American Chemistry Council (ACC).

The economists expect the overall GDP to decline by 2% in 2009, 0.2 point worse than expected a month ago, with consumer spending predicted to decline by 1.1%, also under January expectations, the ACC said.

Industrial production is predicted to fall 7.2% in 2009, 1.4 points worse than January predictions and a further decline from the 1.8% drop in 2008, the ACC said.

Likewise, business investment is expected to fall 10.4%, 1.6 points under January numbers and a sharp contrast from the 1.8% gain in 2008 and the 4.9% gain in 2007, the ACC said.

Expectations for housing starts declined significantly as well, with February’s prediction of 540,000 units, a 58,000 reduction from January figures, the ACC said. That prediction would represent a 74% decline from the 2005 peak of 2.07m units.

For 2008, the US GDP showed a 1.3% gain, with consumer spending up 0.3%, the ACC said.

Nonetheless, the world recession directly impacted the chemical markets in 2008, with year over year drops in polyethylene (PE) and polypropylene (PP), according to the ACC’s weekly report.

Polyethlene production fell by 39.1% year over year, and PP resins declined by 15.4%, the ACC said.

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By: Ben DuBose
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