US economy to grow at 3 to 3.6 % in 2011
24 Nov 2010
The US economy, the world's largest, is expected to grow between 3 per cent and 3.6 per cent next year, a pace slower than the US Federal Reserve's June forecast of 3.5 per cent to 4.2 per cent.
At the same time, unemployment, currently at 9.6 per cent is expected to fall slightly to 8.9 per cent to 9.1 per cent next year. In June, the central bank's forecast said it would to fall below 9 per cent in 2011.
The new forecasts had been revealed in the minutes of the meeting of the Fed's Open Market Committee, when it decided on an infusion of a further $600 billion into the economy.
The sluggish recovery has seen the Republicans gain control of the House of Representatives from the Democrats and ignited a fierce debate over how to restore the country's economic health.
While it is generally acknowledged that a repeat of the last housing-led boom is not desirable, with unemployment still around 10 per cent, the direction of the change from domestic consumption to exports does not seem to have many takers.
Before the release of the Fed's minutes, there was some room for hope in the latest estimate of how the economy performed in the third quarter. Gross domestic product was up at an annual rate of 2.5 per cent, according to the Commerce Department, higher than the first estimate of 2 per cent and overtaking the 1.7 per cent pace of the second quarter.
