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US firms cut growth estimates: Survey

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WASHINGTON : As they continue to feel the impact of US trade wars and struggle to find workers, American companies have rolled back their growth estimates for this year, according to a survey released yesterday.

The US economy will continue to grow but "barely half" of the business economists surveyed now forecast gross domestic product (GDP) to expand by more than 2 per cent this year, "compared to 67 per cent of respondents in the January survey", according to the semi-annual survey by the National Association for Business Economics.

Most of the rest expect the economy to grow by 2 per cent or less, the survey showed.

The government last Friday reported that the US economy expanded 3.2 per cent in the first three months of the year, but many economists have said the pace cannot be sustained.

Companies in the survey continue to try to adjust to the impact of retaliatory tariffs on US goods and to US tariffs on imports that have raised costs.

Three-quarters of goods-producing companies reported a negative impact, with 67 per cent of manufacturers indicating they had faced higher materials costs and half have raised prices of their products, the survey showed.

In addition, 42 per cent reported negative sales and a third said they had delayed planned investments.

Labour shortages continue to dog the companies surveyed. Nearly 80 per cent of them were having difficulty finding high-skilled workers. Half face shortages of mid-skill workers.- AFP