Word: rated
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Dates: during 1980-1989
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...Administration last week acknowledged the economy's weakened position when it predicted growth of only 2.7% for the year, down from the Reagan Administration's five-month-old projection of 3.5%. The White House forecasters, looking through the rose-colored glasses favored by most Administration economists, calculate a growth rate of 2.6% for 1990, but a consensus of 52 economists surveyed by the Blue Chip Economic Indicators holds that the economy will grow at a rate of less than 1.5% during the final half of the year and at about the same sluggish pace in 1990. Says Norman Robertson, chief...
Despite concerns that the expansion will falter, most economists believe a modest slowdown is necessary to suppress inflation, which had grown particularly stubborn in the past two years. Consumer prices rose at an annual rate of 5.9% during the first half of 1989, up from 4.1% last year. "The economy was running too fast for its own good," says Francis Schott, chief economist for Equitable Life Assurance. "It was working itself up to an inflationary frenzy...
Sensing the inflationary pressures early last year, the Fed tightened credit and dampened growth. In June the Fed was helped in its task by falling energy costs. The Government reported last week that consumer prices last month increased at an annual rate of just 2%, the slowest pace in 16 months. While Greenspan said he sees inflation as a lingering menace, he confirmed that for the moment it has been eclipsed by a need to keep the economy afloat. As a result, interest rates on three-month Treasury bills have fallen from a high of 9.4% in late March...
...moment, though, U.S. exports are moving erratically. During the first four months of the year, America's overseas sales grew at a healthy 15% annual rate, but fell 0.9%, to $30.5 billion, in May. Those who predict a soft landing see the one-month reversal as only a temporary setback; others are more troubled. Says Allen Sinai, chief economist of the Boston Co. Economic Advisors: "The trade-deficit report is yet another sign of the potential for a recession sometime within the next six to nine months...
Homebuilding could be another strong foundation for the economy. Real estate usually takes a tumble just before a recession begins and stages a comeback as a recovery takes hold. This time some economists predict that the housing industry, aided by falling mortgage rates, may bounce back later in the year. Last week the Government reported that housing starts during June rose 7%, to an annual rate of 1.4 million. Even so, some experts are cautious about predicting a housing boon because the rise was entirely attributable to an increase in multifamily houses and apartment buildings. There was no growth...