OTTAWA, July 22 /CNW Telbec/ - The U.S. economy is expected to grow by
1.8 per cent in 2008, but Americans' purchasing power and household balance
sheets are in worse shape than they were one year ago, according to the
Conference Board's U.S. Outlook - Summer 2008.
"While economists continue to debate whether or not the U.S. economy is
technically in recession, it certainly feels like one to many
Americans-especially those facing home foreclosures and those who lost their
jobs," said Kip Beckman, Principal Research Associate. "And with gas prices
surging above $4 per gallon, it is not surprising that consumer confidence is
at its lowest level since the early 1990s."
Declining growth in households' real incomes is attributable to the
weakening job market and rising energy and food costs. Around 325,000 jobs
have been lost in the first half of this year, and losses have been widespread
across many sectors of the economy. Although retail sales-with the notable
exception of automobiles-have been stronger than expected in the first half of
the year, consumer spending is forecast to grow by just 1.5 per cent in 2008.
The U.S. trade sector is expected to keep the economy from entering a
deep downturn. The weak U.S. dollar and strong global demand are bolstering
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