Sluggish Hiring Seen as a Threat to Recovery
The Wall Street Journal | June 13
The potential for a persistent slowdown in hiring is the biggest threat to the U.S. recovery, according to economists in the latest Wall Street Journal economic forecasting survey, as they sharply cut the number of jobs they projected the economy would create in coming months… In the latest survey, the economists lowered their forecasts for second-quarter growth in gross domestic product to 2.3% at a seasonally adjusted annual rate—down from last month’s forecast of 3.2%. However, they see growth perking up to 3.3% in the second half of 2011.
Second Half 2011 U.S. Growth Rebound Intact, Economists Say
Bloomberg | June 10
Slowdowns in consumer spending and employment will prove temporary, giving way to a U.S. growth rebound in the second half of 2011, economists surveyed by Bloomberg News said. After growing at a 2.3 percent annual pace this quarter, the world’s largest economy will expand at a 3.2 percent rate from July through December, according to the median forecast of 67 economists polled from June 1 to June 8.

Cleveland Fed’s Top Economist Sees US ’11 GDP Below 3%
Dow Jones | June 10
The U.S. economy’s slowdown should prove temporary as supply disruptions stemming from Japan’s earthquake are solved earlier than anticipated and gasoline prices remain tame, a top economist at the Federal Reserve Bank of Cleveland said Friday. However, Cleveland Fed Research Director Mark Schweitzer cautioned that the U.S. economy is unlikely to grow at a very strong pace for some time as continued troubles in housing weigh on consumer confidence and spending. U.S. gross domestic product, the broadest measure of economic activity, should expand by less than 3.0% in 2011 after high energy prices weighed on consumer spending and Japan’s disaster hit auto sales in the first half of the year, the central bank economist said.
Analysts cut U.S. Q2 growth forecast to 2.5% rate
MarketWatch | June 9
Economists polled by MarketWatch lowered their estimate for second-quarter GDP to a 2.5% annualized growth rate, according to a special survey conducted this week. While this is faster than the 1.8% growth rate reported in the first quarter, it is down from earlier projections for Q2 growth of about a 3.35% rate that prevailed over the past month. Weak job growth and a sharp slowdown in the manufacturing sector in May have raised doubts about the health of the economy.
Higher Growth, Lower Unemployment Predicted for Second Half of 2011
The Livingston Survey (Philadelphia Fed) | June 9
The 35 participants in the June Livingston Survey have raised their estimates of output growth for the second half of 2011. The forecasters, who are surveyed by the Federal Reserve Bank of Philadelphia twice a year, project that the economy’s output (real GDP) will rise at an annual rate of 2.2 percent during the first half of 2011 and 3.2 percent during the second half of 2011, followed by growth of 3.0 percent (annual rate) in the first half of 2012. The projection for slower real GDP growth in the first half of 2011, which is 0.3 percentage point lower than the projection in the survey of six months ago, will be compensated with stronger growth in the second half of 2011.
Monthly Outlook
Wells Fargo | June 8
Our forecast calls for real GDP to rise at a 2 percent pace during the second quarter, which is only slightly above first quarter growth. The composition, however, should be markedly improved with real final sales strengthening from the first quarter’s paltry 0.6 percent pace to a solid 3.3 percent pace in the second quarter and 2.5 percent in the second half of this year. One turnaround factor later this year is that the drag from government spending should also diminish as revenue growth slowly improves at the state and local level.
Economy Brakes Even Before Fed Takes Its Foot Off the Accelerator
Northern Trust | June 8
Consistent with our downwardly-revised real GDP growth outlook, we have revised up our forecast for the unemployment rate. In addition, we have revised down our forecast for the yield levels of the Treasury 2- and 10-year securities. (See tables at the end of this commentary containing our current and April 28 forecasts.) If we are close to the mark on our second-half GDP and unemployment rate forecasts, we could envision another round of Fed quantitative easing commencing early in 2012 with no Fed policy interest rate hikes occurring until early 2013.
Solid Economic Growth Expected in 2011 and 2012, According to Chicago Fed Automotive Outlook Symposium Participants
Chicago Fed | June 6
The eighteenth annual Automotive Outlook Symposium was held in Detroit on Thursday and Friday, June 2–3, and drew more than 90 participants from manufacturing, banking, consulting and service firms, and academia. This year, 24 individuals provided a consensus outlook—forecasts for major components of real gross domestic product (GDP), as well as several key statistics for the U.S. economy. The median forecast results are presented in the table. According to the median forecast of symposium participants, the nation’s economic growth rate in 2011 is expected to be a bit slower than in 2010, inflation is predicted to rise, and the unemployment rate is anticipated to move lower. The pace of economic growth in 2012 is expected to edge higher, with inflation easing and the unemployment rate continuing to head lower. Real GDP, after having increased 2.8% last year, is forecasted to rise by 2.6% this year and 2.9% in 2012.