US economic outlook worsens for 2010, 2011 – chem group

24 September 2010 22:51  [Source: ICIS news]

HOUSTON (ICIS)--US economic expectations for 2010 and 2011 among economists became more pessimistic in September than in August, the American Chemistry Council (ACC) said on Friday.

In its monthly Economic Forecasters Survey, the trade group revealed that expectations for US GDP growth fell by 0.2 percentage point to 2.7% for 2010, and by 0.4 percentage point to 2.4% in 2011.

The drops in both years were accompanied by reductions in anticipated consumer spending, light-vehicle sales and housing starts. All of those categories translate to eventual chemical demand.

In 2010, consumer spending was projected to rise 1.5%, down 0.2 percentage point from the August results.

Meanwhile, expectations for light-vehicle sales slipped by 100,000 units to 11.4m vehicles, and forecasts for housing starts were down 34,000 units from the prior-month survey.

Likewise, the outlook for 2011 consumer spending slipped by 0.3 percentage point to an expected 2.1% gain. Projections for light-vehicle sales and housing starts were down 100,000 units and 55,000 units, respectively, from the August survey.

Moreover, the predicted unemployment rate held at 9.3%, reflecting expectations of a jobless recovery, the ACC said.

“Expectations are still sound but clearly moderating,” the trade group said.

For 2012, the GDP and consumer-spending indexes were projected to rise by 2.8% and 2.7%, respectively. The ACC did not specify how those figures compared with expectations in the prior month survey.

The declining expectations in the monthly surveyed mirrored lower chemical production rates, the ACC said, which slipped 0.2% in August following a 0.6% drop in July.

Production declined in all regions, except for the US Gulf coast, which was flat.

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By: Ben DuBose
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