More US growth concerns, less recession fears: Survey

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Oct 08, 2019 06:00 am

WASHINGTON: Economists have become more concerned about US growth prospects, citing trade friction as the major worry, but recession risks have receded slightly, according to a survey released yesterday.

Nearly half of the panel surveyed by the National Association for Business Economics (Nabe) expect a recession before the end of next year, down from 60 per cent in the prior survey.

The panel expects the world's largest economy to slow, with growth falling below 2 per cent for the first time since 2016.

The US labour market remains strong, according to recent data but manufacturing is in recession while the larger services sector is slowing, giving rise to fears about the health of the US economy, especially amid President Donald Trump's grinding trade war with China and increasing tensions with Europe.

The Nabe panel "turned decidedly more pessimistic about the outlook over the summer, with 80 per cent of participants viewing risks to the outlook as tilted to the downside," said Mr Gregory Daco, the group's survey chair and chief US economist at Oxford Economics.

"The rise in protectionism, pervasive trade policy uncertainty, and slower global growth are considered key downside risks to US economic activity," he said in a statement on the findings in the quarterly survey. - AFP