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Economists See Just Enough Growth for Fed to Pull Back
The Wall Street Journal / August 11, 2013
The U.S. economic growth outlook has been upgraded to decent from lousy—which, while some distance from good, is likely good enough for the Federal Reserve to pull back on its stimulus later this year.
On the positive side, fears of another downturn are minimal. Economists in the latest Wall Street Journal economic forecasting survey put less than a 15% chance on another recession hitting in the next 12 months.
But at the same time, they put only a 13% chance that growth in gross domestic product this year will be stronger than the long-run average of 3.5%.
The latest GDP data released last month showed that the economy has been barely chugging along with growth below 2% at a seasonally adjusted annual rate for three consecutive quarters. Forecasts for the rest of the year remain depressed at 2.3% growth in the third quarter and 2.7% in the fourth.