Washington has revised its outlook for economic growth in the United States this year. In December, economic growth for 2005 was predicted to be 3.5%, but now they are expecting 3.4%.
Washington’s new forecast is also calling for an increase in inflation. In December, 2.0% was projected, but now they are expecting inflation to go up to 2.9%.
“Economic growth is steady, it is strong and our economy’s underlying fundamentals are robust,” said United States Treasury Secretary John Snow. The New York Times Reports:
The White House also predicted that the nation would add about 178,000 jobs a month this year and that the unemployment rate would hover at 5.1 percent – the level it reached last month.
The forecast is in line with Wall Street forecasts and takes into account the effect of high oil prices on inflation as well as on growth.
The forecast confirms that the economic expansion “is expected to continue at a healthy and sustainable pace,” said Harvey S. Rosen, chairman of the Council of Economic Advisers.
“The updated forecast remains largely the same as what we projected six months ago,” stated the chairman of the president’s Council of Economic Advisers, Harvey Rosen. “The economic expansion is continuing.”
Interest rates are expected to go up. The new outlook shows rates on 10-year Treasury notes increasing from about 4% to about 5.2% in two years. This will be taken into consideration when budget deficit estimate is updated next month.
Chris is a staff writer for murdok. Visit murdok for the latest ebusiness news.
