Economists Less Optimistic About US Economy

The United States economy will continue to grow, but at a rate slower than previously expected.

That’s what a survey of economists released this Monday by the National Association for Business Economists (NABE) shows. 

A panel of 52 economists lowered their forecast for the growth in the last quarter of this year and 2021.

From October to December, they expect a 4.9% rise in the annual GDP rate, compared with a 6.8% projection in the previous survey, from June.

For 2020 as a whole, they expect a 4,3 contraction, the first decline since 2009, when the economy shrunk 2.5%.

For 2021, they lowered their forecast from 4.8% to 3.6% growth.

Thirty-eight percent of the panelists believe that the economy will have returned to pre-pandemic GDP levels by the second half of 2021, 32% expect it to reach that level in the first half of 2022, and 30% believe it will occur in the second half of 2022 or later.

A potential second wave of COVID-19 and the inability of Congress to reach a deal for a second coronavirus economic plan are considered the main threats for the recovery.

Treasury Secretary Steve Mnuchin and House Speaker Nancy Pelosi spoke for about an hour Monday by phone and are set to talk again this Tuesday, hoping to make a deal to approve the stimulus before Election Day, on November 3rd.

We should know how likely that is in the next few days, but both sides have interest in delaying so that they can blame the other side politically.

Democrats approved a $2.2 trillion bill last week that includes the extra $600 weekly for jobless benefits until January (it expired at the end of July) and also another $1,200 direct payment to most workers.

As the cold weather approaches, the number of coronavirus cases is growing in many states.

According to “Reuters,” nine states saw record increases in new cases last week: Kansas, Kentucky, Minnesota, Montana, Nebraska, New Hampshire, South Dakota, Wisconsin, and Wyoming.

If you’re worried about trading a recovering market, you need to watch Rob and Markay’s State of the Market address.