WSJ: Economic Recovery Appears to Have Reached More Solid Ground

Tuesday, 25 Jun 2013 07:45 AM

By Dan Weil

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The economy, which has recovered more slowly from the 2007-09 recession than from previous downturns, now looks like it's on more solid footing, according to The Wall Street Journal.

Gross domestic product expanded at 2.4 percent in the first quarter, and economists surveyed by the paper expect 2.3 percent growth for the year as a whole and 2.8 percent for 2014.

Meanwhile, Federal Reserve policymakers are more optimistic. The central tendency of their forecasts calls for an expansion of 2.3 to 2.6 percent this year and 3 to 3.5 percent for 2014.

Video:
Economist Predicts 'Unthinkable' for 2013

The Fed's optimism was illustrated by Chairman Ben Bernanke's comments last week that the central bank may taper its quantitative easing later this year.

The housing sector is on the rebound, the energy sector is booming, consumer confidence has hit a five-year high and jobs are being created at a stable, albeit slow, rate, The Journal notes.

The economic recovery has raised hopes previously before sputtering, but this time may be different.

"The good news is if [the recovery] continues to ratchet up gradually," the strength may snowball, Nariman Behravesh, chief economist at IHS Global Insight, told The Journal.

Joel Naroff, president of Naroff Economic Advisors, voices cautious optimism.

"The economy continues to get better, the housing market is getting better and that's spilling over into consumer confidence," he told Bloomberg. "They [consumers] are spending more and, that's keeping growth at a modest to moderate pace."

Video: Economist Predicts 'Unthinkable' for 2013

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