US business economists see continued growth this year

23 April 2012 20:17  [Source: ICIS news]

WASHINGTON (ICIS)--Business economists are increasingly confident that the US economy will continue to grow this year, according to survey data issued on Monday, with companies’ sales and profits rising along with hopes for more hiring.

The National Association of Business Economists (NABE) said its quarterly survey of members shows “an improvement in economic conditions through higher sales and rising profit margins”.

Almost two-thirds of the responding economists said they expect US gross domestic product (GDP) this year will be as high as 3%.

That would put the US economy on the edge of what economists regard as normal annual trend growth of 3-3.5% for the nation’s output of goods and services.

But only 15% of the polled economists said they have any expectation that US GDP will exceed 3% this year.  However, that figure does represent an improved outlook, since only 5% of economists surveyed in January were anticipating growth above 3% this year.

The economists' expectations for an improving US outlook are in contrast to other recent reports suggesting that a new European recession, a cooling Chinese growth rate and Middle East tensions could combine to chill the already weak US recovery.

Although only 28% of economists said their firms are hiring new workers, fully 40% said they believe US employment figures will rise over the next six months.

NABE said most of its members also anticipate relative stability over the next three months for their raw materials costs and for pricing of their own companies’ products.

The US economists were not significantly concerned about the potential impact of the European sovereign debt crisis on their businesses, at least not over the next six months.

However, the survey was conducted in early April, before renewed concerns about the financial stability of Spain and new worries about a possible debt crisis in Holland put US stocks into a sharp downturn on Monday.

Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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