ICS Magazine

US economy set for second-half recovery-Fed survey

June 20, 2003
NEW YORK, June 20 (Reuters) - The U.S. economy is still set for a pick-up in the second half of this year and unemployment will gradually decline over the coming year, a regional Federal Reserve Bank survey said on Friday.

A semiannual survey of 30 private-sector and academic economists conducted by the Federal Reserve Bank of Philadelphia predicted the world's largest economy will grow by 3.5 percent in the second half of 2003, only a tad softer than the 3.6 percent forecast of the previous survey.

Next year, forecasters across the nation see a further strengthening to a 3.8 percent growth rate, which would be slightly above the economy's long-term trend and help to gradually bring down the jobless rate.

"In the forecasts, the unemployment rate is expected to decline from 6.1 percent in June 2003 to 5.9 percent in December 2003 and 5.7 percent the following June," the Philadelphia Fed said.

Those forecasts are higher than in the last survey, when the unemployment rate was seen declining to 5.5 percent by December 2003.

The Livingston Survey is the oldest continuous survey of economic forecasts, launched in 1946. The Livingston forecasts are roughly in line with other surveys of U.S. economists who generally see the economy accelerating from an anemic growth rate in the first half of this year to more solid growth in late 2003.